BTC continues to rise and breaks new highs: What other positive factors are there and how long will the rise last?

Shaw, Golden Finance

Bitcoin continued its strong performance last week, breaking through the $120,000 mark this morning, setting a new record high.
Since last Wednesday, Bitcoin has started a crazy rise, breaking previous highs. And this week, there will be several important events. The U.S. House of Representatives will vote on three key cryptocurrency legislations this week, including the GENIUS Act, the CLARITY Act, and the Anti-CBDC Surveillance State Act. On Tuesday evening, the June CPI data, an important U.S. economic data, will be released. Affected by these news, Bitcoin and other cryptocurrencies may continue their current strong trend. How long can this wave of market last?

1. Multiple factors stimulate BTC to continue to rise

1. The Fed's policy trend is unclear, highlighting BTC's safe-haven asset attributes

The minutes of the June meeting released by the Federal Reserve on the same day brought complex but suggestive information to the market. The minutes show that there are obvious differences within the Fed on the outlook for monetary policy, which are divided into three major camps: (1) Mainstream camp: Most participants assessed that it might be appropriate to lower the target range of the federal funds rate this year, but ruled out the possibility of an immediate rate cut in July; (2) Hawkish camp: A few participants believed that the target range of the federal funds rate should not be lowered this year; (3) Dove camp: A few participants (possibly including Fed Governors Waller and Bowman) pointed out that if the data development is in line with their expectations, they would be willing to consider lowering the target range of the policy rate at the next meeting.

Although there are differences within the Fed, the signal that "most participants assessed that it might be appropriate to cut interest rates this year" has undoubtedly strengthened the market's expectations for future liquidity easing, which is a positive macro catalyst for risky assets such as Bitcoin.

For details, please refer to "How many times did Trump call on Powell to cut interest rates? Why didn't Powell cut interest rates? 》

2. Trump's tax and spending bill is introduced, and fiscal risks give rise to BTC demand

US President Trump signed the "Big and Beautiful" tax and spending bill on July 4, local time, making it effective. The bill has been controversial for cutting federal aid, increasing long-term debt, and cutting taxes for the rich and large companies. Under the existing terms, the bill will increase the federal deficit by about $3 trillion over the next 10 years; if certain expiring terms are extended, the deficit may be as high as $5 trillion.

After the bill takes effect, its revenue and expenditure mix will put the US Treasury on an unsustainable path.

Although the US government will not default in the short term, the unsustainable debt path will increase the long-term risk of macroeconomic mismanagement, thereby increasing investors' interest in non-sovereign value storage methods such as gold and Bitcoin.

For details, please refer to "The Great Beautiful Act: What are the key contents and why Musk strongly criticizes it"

3. The market no longer cares about the tariff war, and the US stocks and cryptocurrencies have recovered their losses and set new highs

On the 7th local time, US President Trump signed an executive order to extend the so-called "reciprocal tariff" suspension period, and postponed the implementation time from July 9 to August 1. Starting from the early morning of the 8th Beijing time, Trump has successively announced his tariff letters to many countries. Trump has now sent tariff letters to 22 countries. The market is no longer concerned about the tariff war. After the tariff war in April, US stocks have recovered all their losses and set new highs. In the early morning of today, the three major US stock indexes rebounded, and the Nasdaq closed at a record high again.

Although the tariffs have caused an impact on the crypto market, the recent market performance has been very stable, which reflects the volatility and responsiveness of cryptocurrencies in times of global uncertainty. Cryptocurrency is also increasingly seen as a valuable hedging tool that is not affected by any government or policy decisions. Therefore, investors may be more inclined to Bitcoin, a safe-haven hedging asset, thereby stimulating the rise of Bitcoin.

4. SEC releases statement on securities tokenization, and cryptocurrency enters the mainstream financial system

The U.S. Securities and Exchange Commission (SEC) issued a statement on securities tokenization, stating that blockchain technology has opened up a new model for issuing and trading securities in a "tokenized" form. Tokenization has the potential to promote capital formation and enhance investors' ability to use their assets as collateral. However, tokenized securities are still securities. Therefore, market participants must carefully consider and comply with the relevant provisions of federal securities laws when trading such instruments.

Recently, Robinhood and Kraken launched tokenized stock trading for the first time. Robinhood's system is based on Ethereum's Layer 2 network Arbitrum, while Kraken's xStocks system is based on Solana. SEC Chairman Paul Atkins called tokenization a major "innovation," adding that the SEC "should focus on how to advance tokenization in the market" and that the days of regulation through law enforcement "are over." The rise of tokenized securities has driven the blockchain and crypto industries into the mainstream financial market and stimulated the continued rise of Bitcoin and other cryptocurrencies. For details, please refer to "The wave of tokenized US stocks is coming. Who is defining the new paradigm of on-chain securities?" 5. Crypto treasury companies continue to emerge, and ETFs and other demands reshape the BTC market landscape. Strategy, a pioneer in corporate Bitcoin investment, has increased its holdings of Bitcoin in large quantities, with a market value far exceeding the value of Bitcoin on its balance sheet, indicating that there is an excess demand in the market for Bitcoin exposure through equity instruments. More companies are beginning to adopt this strategy, and some companies have expanded it to other digital assets besides Bitcoin. In addition to Bitcoin, SharpLink Gaming announced that it would transform into an Ethereum Treasury company with the support of crypto investors such as Consensys. Other entrepreneurs have further expanded the model and created crypto vault companies for Solana (Upexi), XRP (VivoPower) and even Trump-themed meme coins (Freight Technologies). The surge in crypto vault companies shows that investors have a strong interest in exposure to crypto assets listed and traded on stock exchanges.

In addition, demand for traditional financial instruments such as ETFs is reshaping the Bitcoin market landscape. Unlike the past, which mainly relied on retail investors, the institutional capital inflows behind the current round of gains have shown structural characteristics. Data shows that institutional investors continue to buy Bitcoin through various financial instruments, and this demand pattern is more stable than historical speculative buying.

For details, please refer to "Grayscale: The Great Beauty Act and Crypto Treasury Companies Are Generating Bitcoin Demand"

6. Ark Invest stated in its June 2025 Bitcoin Monthly Report that global liquidity relative to Bitcoin supply has reached a 12-year high, and the global broad money supply (M2) corresponding to each Bitcoin in circulation is about US$5.7 million. Given that Bitcoin's future supply growth will continue to slow and global liquidity will continue to expand, this ratio may continue to rise.

7. Ark Invest stated in its June 2025 Bitcoin Monthly Report that long-term holders (Long Term Holders, addresses holding BTC for 155 days or more) hold 74% of the total BTC supply, reaching a 15-year high. This trend shows that the market is increasingly convinced of Bitcoin's role as a store of value (i.e. "digital gold").

8. BTC price lags behind global liquidity by 10-12 weeks. If the global liquidity index is moved forward by 10 weeks, the correlation between Bitcoin's price trend and it will be significantly enhanced. After further optimization, it was found that the most accurate lag period is about 56 to 60 days, or about 2 months. This lag effect means that when investors analyze the impact of liquidity on Bitcoin, they need to consider the time delay, rather than just focusing on the current liquidity level. If global liquidity continues to expand at an accelerated pace, Bitcoin may still have room to rise.

2. What will be the future trend of Bitcoin and the crypto market?

Currently, it is not only the cryptocurrency market, but also the strength of large technology stocks that stimulates the return of risk appetite. The three major US stock indexes rebounded, and the Nasdaq closed at a record high again. Nvidia once exceeded the market value of 4 trillion US dollars. The demand for the 10-year US Treasury auction was strong, and the US Treasury price strengthened to recover all the losses this week. It can be said that the current bull market is already in the rhythm of development. What will happen to the Bitcoin cryptocurrency market in the future? Is there any motivation to continue to exert its strength?

At present, the channel for Bitcoin to continue to rise has been opened. And other altcoins will follow the surge in the market.

1. Bitwise Chief Investment Officer Matt Hougan said in an interview with CNBC recently that Bitcoin is expected to reach $200,000 by the end of 2025, and pointed out that the current rise is driven by structural factors and will continue for many years. Hougan emphasized that institutional funds continue to flow in, while the daily supply of Bitcoin is only 450, and the supply and demand are seriously unbalanced. He believes that the market is entering a new stage of "demand continues to exceed supply", and this force will drive BTC to rise in the long run. He also said that favorable policies, legislative advancement, institutional adoption and macro uncertainty together constitute a "rare force" on Bitcoin, which is the fundamental driver of the current rise.

2. According to data analysis by Sentimentrader cited by The Kobeissi Letter, the vast majority of currencies are not currently in the historical high range (5% range of the high within 252 days). In contrast, when Bitcoin set new records in February and November 2024, about 75% and about 40% of cryptocurrencies were within 5% of their 252-day highs, respectively. Historically, when a large number of cryptocurrencies are trading near their all-time highs, Bitcoin will fall back. The current divergence suggests that Bitcoin may have more room to rise.

3. Bitcoin has risen to a record high, driven by the interest of institutional investors and President Trump's support measures, Patrick Munnelly, an analyst at Tickmill Group, said in a report. He said: "The recent surge in the value of Bitcoin is driven by continued buying by institutional investors, who have purchased large quantities of available supply, resulting in a continuous reduction in liquidity on trading platforms." In addition, Trump ordered the establishment of a strategic reserve of Bitcoin, while the U.S. Senate passed a bill last month to provide a regulatory framework for stablecoins.

4. Adam Guren, chief investment officer of Hunting Hill, pointed out that Bitcoin's breakthrough of $112,000 reflects the compounding effect of ETF inflows, rising institutional adoption and a favorable macroeconomic environment: "Unlike previous cycles, current demand is structural, regulated and sticky."

5. Vincent Liu, chief investment officer of cryptocurrency trading company, said that traders should be vigilant about potential profit-taking or macroeconomic changes, which may trigger a pullback, but the current trend remains firmly bullish.

6. Axel Adler Jr, an analyst at CryptoQuant, said that the 30-day unrealized P/L ratio of Bitcoin is at the 80% percentile level. This indicator shows that the ratio of the amount of coins currently in a profitable state to the amount of coins in a loss state is significantly higher than usual, and most Bitcoin holders are in a profitable state. Since the indicator has not yet reached the extreme range of 90-100%, it means that there is still room for Bitcoin prices to rise further before holders begin to actively sell.

7. Matt Mena, a cryptocurrency research strategist at 21Shares, said: As the M2 money supply begins to rise again, historical data shows that some liquidity will flow into Bitcoin and other digital assets. Historically, Bitcoin prices have been tracking the M2 money supply, which is the Federal Reserve's estimate of liquid assets, including cash, deposits in checking accounts, savings accounts, and other short-term savings tools such as money market funds. Cryptocurrency influencer Anthony Pompliano said: If Bitcoin continues to follow the growth of money supply, we may see the price of each Bitcoin reach $150,000 by the end of the year.

8. Coindesk analyst Omkar Godbole Technical analysis shows that a potential bullish trend is forming on the chain, and more and more traders believe that Ethereum (ETH) is expected to hit $3,000 in the near future. In addition, the Ethereum validator architecture is undergoing a change, which may consolidate ETH's position as Wall Street's most popular programmable asset.

9. Cathie Wood, CEO of ARK Invest, said that the price of BTC will increase 15 times in the next five years. "BTC represents a unique global currency system, and its volatility is decreasing as more and more investors hold it."