Bitcoin's highest price forecast for next year... Attention on institutional fund inflows and regulatory policies

Source: DecenterKorea Original Title: Will Bitcoin Reach Its All-Time High? Attention on ‘This Legislation’ Early Next Year [Decenter] Original Link: https://www.decenter.kr/NewsView/2H1XZU6X1V/GZ03

The virtual currency market, led by Bitcoin, is expected to stabilize next year as the proportion of institutional investors increases and price volatility decreases. In particular, the market-friendly policies of the U.S. government, which has incorporated cryptocurrencies into the regulated financial system, are accelerating the inflow of institutional funds, suggesting a continued medium- to long-term upward trend.

As of this morning, Bitcoin’s price was $87,132, down about 6% from the beginning of the year. Bitcoin, which started the year in the $90,000 range, fell to around $70,000 in April following the announcement of comprehensive tariffs. Later, in July, a bill regulating stablecoin issuance and oversight was passed, causing the price to surge back to around $120,000, but international trade conflicts and government shutdowns hit the market, pushing it down to the $80,000 range.

Outlook for Record Highs Next Year

While concerns about a lack of year-end rally and further declines are present, the market is optimistic that Bitcoin could hit new all-time highs next year. Major financial firms have projected Bitcoin’s peak price at $189,000 and $170,000 respectively. Some analysis agencies suggest that the peak could occur in the first half of next year.

Along with Bitcoin, optimistic forecasts are also emerging for Ethereum. Major financial institutions have projected Ethereum’s price to range between $4,304 and $5,132 next year, which is 40-45% higher than current levels. “Unlike Bitcoin, Ethereum’s staking rewards make it attractive to institutional investors,” analysts say. Staking involves depositing cryptocurrency into the network to participate in transaction validation and earning rewards in return.

Major Wall Street financial firms are emphasizing the potential for cryptocurrency price increases due to structural market changes. Experts note that since the launch of cryptocurrency spot ETFs(ETF) last year, institutional funds such as pension funds and insurance companies have begun to flow in, and this shift in fund characteristics has started to reduce short-term volatility, marking a structural change.

“The main driver of the market is shifting from speculative demand to institutional and regulatory structural changes,” they say. “If the related legislation is finally passed early next year, inflows into ETFs will increase further.” The legislation clearly distinguishes cryptocurrencies as securities tokens and digital commodities. Establishing a legal classification for cryptocurrencies could encourage larger institutions like banks, which have hesitated to enter the market, to participate more actively.

Following ETFs, Stablecoins and RWA to Attract Institutional Capital

In particular, next year, the markets for stablecoins and real-world asset tokenization(RWA) are expected to expand, further accelerating capital inflows into the cryptocurrency market. While cryptocurrency spot ETFs have created a pathway for institutional funds, stablecoins and similar assets are seen as key infrastructure to bring cryptocurrencies into the regulated financial ecosystem. The stablecoin market, in particular, has shown rapid growth since the relevant legislation was passed in July, surging from $203 billion last year to $317 billion this year, an increase of over 56%. The RWA market also experienced rapid growth, from $15.2 billion to $18.8 billion during the same period.

However, there are also pessimistic views. Some analysis agencies argue that the “4-year cycle theory(which explains Bitcoin’s price fluctuations in four-year intervals)” remains valid, and that next year could enter a correction phase ahead of the next halving. They warn that if the peak was $120,000 in October this year, a “crypto winter” could materialize next year, with Bitcoin prices projected between $65,000 and $75,000.

Experts also point to other variables such as policy delays, macroeconomic factors like interest rates, the dollar, liquidity, regulatory uncertainties, and the sustainability of ETF fund inflows.