One, Introduction

As the representative of cryptocurrencies, Bitcoin has attracted global investors’ attention since its birth. Its price trend is like a barometer of the financial market, affecting the hearts of countless investors. Recently, the price of Bitcoin has surged to $97,000, and this breakthrough point has sparked widespread discussions in the market. From the market perspective, Bitcoin has experienced multiple rounds of significant fluctuations in the past few years, with each drastic price change accompanying fervor and panic among market participants. In the current complex and volatile global economic situation, amidst the uncertainties facing traditional financial markets, the price trend of Bitcoin appears particularly crucial.

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2. Bitcoin Overview

2.1 Definition and Characteristics of Bitcoin

Bitcoin is a virtual encrypted digital currency based on blockchain technology, proposed by Satoshi Nakamoto in 2008 and officially launched on January 3, 2009. It achieves a peer-to-peer electronic cash system in a decentralized manner, which means that in the Bitcoin transaction system, there is no need for traditional financial institutions such as banks to act as intermediaries, and users can directly transact with each other.

One of the most significant features of Bitcoin is decentralization. In the traditional financial system, the power to issue currency, regulate transactions, etc., is centralized in central banks or financial regulatory agencies. Bitcoin, on the other hand, relies on the distributed ledger technology of blockchain, maintained by numerous nodes globally to record transactions and operate the network. Each node has a complete copy of the ledger, and every transaction needs to be verified by a majority of nodes in the network to be confirmed. This decentralized nature of Bitcoin means it is not controlled by a single institution, reducing the risks associated with central institution failures or malicious operations, making transactions more autonomous and fair.

The limited total supply is also a key feature of Bitcoin. The total supply of Bitcoin is set at 21 million, and according to its algorithm, the production rate of new Bitcoins will gradually slow down over time, with the mining reward halving approximately every four years. This limited supply mechanism gives it a scarcity similar to gold in theory, avoiding the problem of currency inflation caused by overissuance, and attracting numerous investors to use it as a store of value, expecting the value of Bitcoin to steadily rise over time.

Bitcoin also has the characteristic of anonymity and transparency coexisting. During the transaction process, users use encrypted addresses instead of real identity information, which provides users with a certain degree of privacy protection, making it difficult to track and associate the identities of both parties involved in the transaction. However, Bitcoin transactions are openly and transparently recorded on the blockchain, where anyone can query detailed information about each transaction, including transaction amounts, times, and the addresses of the parties involved. This transparency makes Bitcoin transactions highly traceable, effectively preventing fraud, money laundering, and other illegal activities, ensuring the fairness and credibility of transactions.

In addition, Bitcoin has the convenience of global circulation. As long as there is internet connection, users can conduct Bitcoin transactions and transfers anytime, anywhere in the world, without being restricted by geographical or national boundaries. This convenience of cross-border transactions greatly reduces the cost and time of international remittances and trade, providing a new payment and settlement method for economic activities worldwide, especially for those regions and populations with insufficient coverage of traditional financial services or frequent cross-border transactions, the advantages of Bitcoin are even more apparent.

2.2 Development History of Bitcoin

In 2008, Satoshi Nakamoto published a paper titled ‘Bitcoin: A Peer-to-Peer Electronic Cash System’, proposing the concept of Bitcoin against the backdrop of the global financial crisis. The aim was to create a new payment network that is decentralized and does not require trust in third-party intermediaries. This is how the concept of Bitcoin was born. On January 3, 2009, Satoshi Nakamoto mined the first block of Bitcoin, known as the ‘genesis block’, on a small server in Helsinki, Finland, and received a reward of 50 bitcoins. This marked the transition of Bitcoin from theory to practice, officially beginning its development journey.

In the early days of Bitcoin, it was only circulated in niche circles such as cryptography enthusiasts and computer programmers, mainly used for technical exploration and communication. On May 22, 2010, a landmark event in Bitcoin history occurred - Bitcoin enthusiast Laszlo Hanyecz purchased two pizzas for 10,000 Bitcoins, marking the first real-world purchasing power of Bitcoin. At that time, 10,000 Bitcoins were worth about $41, but later these 10,000 Bitcoins soared in value to millions of dollars. The global cryptocurrency community refers to May 22 as ‘Bitcoin Pizza Day,’ and this event has also become an important milestone in anchoring the price and development of Bitcoin. On July 17 of the same year, Mt.Gox, the world’s largest Bitcoin exchange, was established, providing a more convenient platform for Bitcoin trading, attracting more people to pay attention to and participate in Bitcoin trading, and the value of Bitcoin began to gradually emerge, with prices starting to fluctuate.

2013 was a crucial turning point for the development of Bitcoin. At the beginning of the year, the price of Bitcoin was still hovering around $13. Subsequently, the Cyprus debt crisis broke out, and bank depositors faced the risk of deposit taxes and asset freezes. The characteristics of Bitcoin as a “decentralized” and “safe-haven asset” were highlighted, and a large amount of capital poured into the Bitcoin market, driving its price to soar all the way to over $200 in April, and reaching a peak of $1200 at the end of the year. This attracted widespread attention from the global media and raised eyebrows of mainstream financial institutions. However, the significant fluctuations in the price of Bitcoin also drew the attention of regulatory authorities, and some countries and regions began to introduce relevant policies to regulate Bitcoin transactions, causing the market to swing violently between frenzy and panic.

In 2017, Bitcoin saw another round of explosive growth. As Bitcoin gradually became more understood and accepted by more people, and with some countries and regions relatively relaxed towards cryptocurrencies, the price of Bitcoin soared from a few hundred dollars at the beginning of the year to nearly 20,000 dollars, with a significant increase in market value, attracting a large number of investors worldwide, and the cryptocurrency market saw an unprecedented investment frenzy. However, subsequently, due to concerns about the market bubble caused by the high price of Bitcoin, tightening of regulatory policies in various countries, and other factors, the price of Bitcoin began to plummet, entering a long period of bear market adjustment, and the price continued to fluctuate and decline in the following years.

In 2020, affected by changes in the global economic situation and the impact of the new crown epidemic, countries have adopted loose monetary policies, and market liquidity has greatly increased. Some large companies and institutions have begun to focus on and acquire Bitcoin as a new type of investment asset allocation, and the institutional recognition of Bitcoin continues to increase. For example, companies like MicroStrategy have bought a large amount of Bitcoin, driving the gradual rise of the Bitcoin price and restoring market confidence to a certain extent. In February 2021, the market value of Bitcoin reached 1 trillion US dollars for the first time, once again becoming the focus of the global financial market, and more and more investors are starting to include Bitcoin in their investment portfolios.

2023-2024, the Bitcoin market continues to develop and evolve. On the one hand, the Bitcoin network continues to undergo technological innovation and upgrades, such as the Taproot upgrade, which improves the privacy and scalability of Bitcoin, paving the way for the implementation of smart contracts. These technological advancements have attracted more developers and users to join the Bitcoin ecosystem. On the other hand, regulatory policies continue to differ globally, with some countries and regions further clarifying the legal status and regulatory framework of Bitcoin, while others strengthen regulation of the cryptocurrency market to prevent financial risks and illegal activities. During this period, the price of Bitcoin has shown intense fluctuations under the influence of various factors, touching key price points multiple times, triggering high attention and heated discussions among market participants.

Recently, the price of Bitcoin has surged to touch $97,000, once again refreshing people’s understanding of the price trend of Bitcoin, and sparking widespread speculation and in-depth research in the market on whether Bitcoin can continue to reach new highs in the future.

Analysis of the time and background when Bitcoin reached $97,000

3.1 Specific Time Nodes

On May 2, 2025, the price of Bitcoin surged, reaching as high as $97,000, breaking the previous all-time high and instantly attracting global financial markets’ attention. At this critical time, Bitcoin’s market performance has sparked widespread attention and discussion among investors, financial institutions, and the media. Market data shows that Bitcoin’s trading volume on that day also showed a significant expansion, demonstrating the market’s high recognition and active participation in the breakthrough of Bitcoin prices.

3.2 Background Factors

The price of Bitcoin reaching $97,000 is not a coincidence, but the result of the complex interplay of various factors, covering multiple key areas such as politics, economy, and the market.

3.2.1 Political Factors

The changing political landscape has had a significant impact on the price trend of Bitcoin. In November 2024, Trump’s victory in the presidential election became a key catalyst for the rise in Bitcoin prices. During the campaign, Trump explicitly promised to make the United States the ‘world capital of cryptocurrencies’ and planned to promote a series of policies favorable to the development of cryptocurrencies, such as dismissing Gary Gensler, the chairman of the US Securities and Exchange Commission (SEC), who has a strict regulatory attitude towards cryptocurrencies, and establishing a national strategic Bitcoin reserve. These commitments have filled the market with confidence in the future development of cryptocurrencies. Investors expect that under Trump’s policy drive, Bitcoin will usher in a more relaxed regulatory environment and broader development space, leading to increased investment in Bitcoin and driving its price continuously upward.

Recently, the news of the Trump team discussing the establishment of a new White House position dedicated to cryptocurrency policy has further fueled the rise in the price of Bitcoin. According to Bloomberg, sources revealed that the Trump team is reviewing candidates for this position, a move interpreted by the market as a further indication of the U.S. government’s increasing focus on the cryptocurrency industry. If this position is established, it will help coordinate the efforts of various U.S. government departments in cryptocurrency regulation and policy-making, providing clearer policy guidance and support for the development of cryptocurrencies such as Bitcoin, enhancing investors’ confidence in Bitcoin and driving its price to touch $97,000 on May 2, 2025.

3.2.2 Economic Factors

The turbulent global economic situation and adjustments in the monetary policies of various countries are important economic backgrounds for the rise in the price of Bitcoin. In recent years, the global economy has faced many challenges, with increased uncertainty in economic growth due to factors such as trade frictions, geopolitical conflicts, etc., impacting the stability of traditional financial markets. In this situation, investors are seeking more diversified investment channels to spread risks. Bitcoin, due to its decentralized nature, limited supply, and other characteristics, is increasingly seen by more investors as a hedge asset and a tool to combat inflation, gaining favor in the market.

The implementation of quantitative easing policies has also provided a favorable economic environment for the rise in Bitcoin prices. In response to economic downturn pressure, many central banks have adopted quantitative easing policies, massively increasing the issuance of currency, leading to excessive market liquidity. With expectations of low interest rates and currency depreciation, investors are turning their funds to assets such as Bitcoin for value preservation and appreciation. For example, the Fed has continuously lowered benchmark interest rates in the past period, leading to a continuous increase in market liquidity. The demand for high-risk assets such as Bitcoin has consequently risen, driving its price further upwards. Additionally, the strengthened market expectation of Fed rate cuts has made investors more optimistic about the investment prospects of Bitcoin, further fueling the rise in Bitcoin prices.

3.2.3 Market Factors

Institutional investors’ large-scale buying behavior is an important market driving force for the rise in Bitcoin prices. As the Bitcoin market gradually matures and gains recognition, more and more institutional investors are starting to include Bitcoin in their portfolios. For example, publicly listed companies such as MicroStrategy continue to increase their holdings of Bitcoin. The company announced in early 2025 that it had acquired around 51,780 Bitcoins for about $4.6 billion, bringing its total Bitcoin holdings to 331,200, with a total value exceeding $30 billion, making it the publicly listed company with the largest Bitcoin holdings. Institutional investors’ large-scale buying not only increases the market demand for Bitcoin but also sends positive signals to the market, attracting more investor attention and follow-up, driving Bitcoin prices higher.

The progress of Bitcoin ETF (Exchange Traded Fund) also has a significant impact on its price. In January 2024, the United States approved the listing of Bitcoin spot ETF, greatly reducing the threshold for investors to purchase Bitcoin, allowing more ordinary investors to indirectly invest in Bitcoin through ETF, attracting a large influx of funds into the Bitcoin market. At the same time, the listing of Bitcoin ETF also enhances the market liquidity and transparency of Bitcoin, strengthens the market’s confidence in Bitcoin, and further promotes the rise in Bitcoin prices. As of May 2025, the asset management scale of Bitcoin ETF continues to expand, showing the continuous enthusiasm of the market for its investment.

4. Bitcoin Price Trend Historical Review

4.1 Key Price Volatility Stage

Since its birth, the price of Bitcoin has been fluctuating, experiencing multiple key price volatility stages, which not only reflect the development changes of the Bitcoin market but also have a profound impact on the global financial market.

In 2011-2012, Bitcoin saw its first bull market and price surge. In the first half of 2011, the price of Bitcoin began to rise rapidly, soaring from around $0.3 at the beginning of the year to surpass $30 in June, reaching a historical high of $230 in November. The significant increase in Bitcoin’s price during this period was mainly due to its increasing recognition among tech enthusiasts and early investors, leading to more people understanding and participating in Bitcoin trading, rapidly increasing market demand. However, as the Bitcoin market was still in its early stages and lacked proper regulation and market mechanisms, the rapid price increase triggered excessive speculation in the market. Subsequently, Bitcoin prices experienced a major correction, plummeting significantly in a short period, causing huge losses for many investors.

In 2013-2014, the Bitcoin market experienced the second bull market and bubble burst. At the beginning of 2013, the price of Bitcoin started to rise again, starting at about $13 at the beginning of the year and soaring all the way to the historical high of $1242 in December. The driving factors of this bull market are relatively complex. On the one hand, the global economic situation is unstable, and investors are seeking new investment channels. Bitcoin, due to its decentralized nature and limited supply, is seen by some investors as a safe-haven asset and a tool to combat inflation, attracting a large amount of capital inflow. On the other hand, the continuous development in Bitcoin’s technology and the gradual expansion of its application scenarios have also strengthened the market’s confidence in its future development. However, as the price continued to soar, the market bubble gradually became evident. Coupled with the increasing uncertainty of regulatory policies, investors’ panic spread, and the Bitcoin price bubble eventually burst. For most of 2014, the price of Bitcoin hovered at relatively low levels, and the market entered a period of deep adjustment.

In 2017-2018, Bitcoin ushered in its third bull market and reached a record high. In the first half of 2017, the price of Bitcoin once again entered a rapid upward trend, starting at around $1,000 at the beginning of the year and reaching a historical high of $20,089 at the end of the year. The market value increased significantly, attracting a large number of investors worldwide, and the cryptocurrency market experienced an unprecedented investment boom. The substantial increase in the price of Bitcoin during this period was not only due to the market’s further recognition of its investment value, but also to the active participation of institutional investors, widespread promotion of blockchain technology, and relatively relaxed attitudes of some countries and regions towards cryptocurrencies. However, the good times did not last long. At the beginning of 2018, the Bitcoin price bubble burst again, leading to a significant decline in price. The main reasons included tightening regulatory policies in various countries, strict restrictions on cryptocurrency trading and initial coin offerings (ICOs), speculative market excess leading to overinflated prices, and rapid price declines once market sentiment shifted. In addition, technical issues and security concerns in the Bitcoin network also raised concerns among investors, further exacerbating the price decline.

In 2020-2021, the Bitcoin market has experienced another round of recovery and prosperity. In 2020, due to the impact of the COVID-19 pandemic, the global economy fell into a crisis, and central banks around the world adopted loose monetary policies, greatly increasing market liquidity. As an emerging digital asset, Bitcoin has attracted a lot of attention from institutional investors and hedge funds, who have included Bitcoin in their investment portfolios as a tool for risk diversification and value preservation and appreciation. For example, companies such as MicroStrategy and Tesla have bought large amounts of Bitcoin, driving the gradual rise in Bitcoin prices. In 2021, the price of Bitcoin continued to rise, reaching a historical high of $69,000 in November. The rise in the price of Bitcoin during this period is not only due to the macroeconomic environment and the promotion of institutional investors, but also closely related to the continuous upgrading of Bitcoin’s own technology and the expansion of its application scenarios, such as the increasing use of Bitcoin in cross-border payments, decentralized finance (DeFi), and other fields, enhancing its market value and attractiveness.

4.2 Summary of Factors Influencing Price Trends

Looking back at the price trend of Bitcoin, it is influenced by a variety of factors, these factors are intertwined and collectively determine the direction and magnitude of Bitcoin price fluctuations.

Regulatory policies are one of the important factors affecting the price trends of Bitcoin. Due to the decentralized nature of Bitcoin and the anonymity of transactions, it faces differences in regulatory policies in different countries and regions during its development. When regulatory policies are relatively loose, such as some countries recognizing the legal status of Bitcoin and allowing its trading and use within a certain range, the market’s confidence in Bitcoin will be strengthened, and investors’ enthusiasm for participation will also increase, thereby driving up the price of Bitcoin. For example, in 2017, Japan officially recognized Bitcoin as a legal payment method, and this policy measure significantly increased the trading activity of Bitcoin in Japan, leading to a rise in prices. Conversely, when regulatory policies tighten, such as some countries banning Bitcoin trading, restricting mining activities, or strengthening supervision of cryptocurrency exchanges, the market often experiences panic, with investors selling off Bitcoin, leading to price declines. In 2017, China’s ban on ICOs and the comprehensive cleanup of Bitcoin trading platforms caused a significant pullback in Bitcoin prices.

The supply and demand relationship in the market is the fundamental factor determining the price of Bitcoin. The total amount of Bitcoin is constant at 21 million, and with the increasing mining difficulty, the production speed of new Bitcoin gradually slows down, resulting in a relatively stable supply. Therefore, changes in market demand have a significant impact on the price. When the market demand for Bitcoin increases, such as when a large number of investors are optimistic about the investment prospects of Bitcoin and start buying Bitcoin, the demand exceeds the supply, causing the price of Bitcoin to rise. The large-scale buying behavior of institutional investors often triggers a herd effect in the market, further driving demand growth and price increases. Conversely, when market demand decreases, such as when investors are concerned about the market outlook and sell a large amount of Bitcoin, the supply exceeds the demand, causing the price to fall. For example, during the stage of bursting of the Bitcoin price bubble, panic selling by investors led to a substantial increase in market supply, while demand sharply contracted, resulting in a rapid decline in the price of Bitcoin.

Technological development is also a key factor affecting the price trend of Bitcoin. Bitcoin relies on blockchain technology, and the continuous innovation and upgrade of blockchain technology, such as improving transaction speed, enhancing security, expanding smart contract functionality, etc., can enhance the practicality and market competitiveness of Bitcoin, strengthen investors’ confidence in its future development, thereby driving up prices. The emergence of the Lightning Network has greatly improved the transaction speed and efficiency of Bitcoin, reduced transaction costs, making Bitcoin more feasible in daily payment scenarios, which has played a positive role in pushing up its price. Conversely, if Bitcoin technology encounters major vulnerabilities or technical bottlenecks that fail to meet market demand, it may cause investor concerns and lead to price declines. For example, the Bitcoin network has experienced the risk event of a 51% attack. Although a large-scale attack did not eventually occur, this event raised concerns in the market about its security, and the price of Bitcoin was affected to some extent as a result.

Changes in the macroeconomic environment also have a significant impact on the price of Bitcoin. During periods of global economic instability, high inflation, or declining interest rates, investors often seek safe-haven assets or investment channels with higher returns. Bitcoin, due to its certain hedging properties and potential for high returns, attracts more attention and capital inflows from investors, driving up prices. During the global financial crisis in 2008 and the economic crises triggered by the COVID-19 pandemic in 2020, the price of Bitcoin experienced varying degrees of increase. Conversely, when the global economic situation is stable, inflation is moderate, and interest rates are rising, investors may be more inclined towards traditional investment assets, leading to a relative decrease in the attractiveness of Bitcoin, and prices may be suppressed.

Market sentiment and investor expectations also play important roles in the fluctuation of Bitcoin prices. The Bitcoin market has high volatility and uncertainty, and investor sentiment and expectations are easily influenced by various factors such as media reports, celebrity statements, market rumors, etc. When market sentiment is optimistic and investors are confident in the future development of Bitcoin, it often triggers a buying frenzy, driving prices up. Positive evaluations of Bitcoin by prominent entrepreneurs or financial experts may attract more investors to follow suit and lead to rapid price increases. Conversely, when market sentiment turns to panic and investors are worried about the market outlook, it may trigger large-scale selling and price plunges. For example, negative news about Bitcoin, such as exchange hacks, tightening regulatory policies, etc., may prompt investors to quickly sell their Bitcoins, leading to a significant price drop.

Analysis of the Possibility of Bitcoin Reaching a New High Again

5.1 Favorable Factors

5.1.1 Macro Economic Environment

The unstable global economic situation has provided strong support for the rise in the price of Bitcoin. Currently, the global economy is facing many challenges, with ongoing trade frictions and frequent geopolitical conflicts, leading to uncertainty in economic growth prospects. In this macroeconomic environment, the stability of traditional financial markets has been severely impacted, prompting investors to seek safe-haven assets to protect their wealth. Due to its decentralized nature and limited supply, Bitcoin is increasingly seen by investors as an ideal safe-haven asset. Unlike traditional currencies, Bitcoin is not controlled by any country or government. Its issuance and transactions are based on decentralized blockchain technology, providing a high level of autonomy and security. Moreover, the total supply of Bitcoin is limited to 21 million coins, making it uniquely advantageous in the face of inflation by effectively resisting the risk of currency devaluation.

During times of economic turmoil, many investors, in order to hedge risks, have poured funds into the Bitcoin market, driving up the price of Bitcoin. Taking the outbreak of the COVID-19 pandemic in 2020 as an example, the pandemic has had a huge impact on the global economy, leading to significant declines in stock markets around the world and causing panic in traditional financial markets. In this scenario, the safe-haven nature of Bitcoin has been highlighted, attracting attention from a large number of investors and capital inflows. Although there was a brief decline in the price of Bitcoin in the early stages of the pandemic, as the market gradually digested the impact of the pandemic and global central banks adopted loose monetary policies, market liquidity increased significantly. As a result, the price of Bitcoin quickly rebounded, reaching new highs in the subsequent period.

The continued implementation of quantitative easing policies is also an important driving factor for the rise in Bitcoin prices. To cope with economic downturn pressure, central banks in many countries have adopted quantitative easing policies, issuing a large amount of currency, leading to excess market liquidity. Under the expectation of low interest rates and currency depreciation, investors have turned their attention to assets such as Bitcoin in order to preserve and increase asset value. As an emerging digital asset, Bitcoin has different characteristics from traditional assets, with a lower correlation to the price trends in traditional financial markets, providing investors with diversified investment options and reducing portfolio risks. Quantitative easing policies result in an increase in the money supply and abundant funds in the market, which need to find new investment channels. Bitcoin, with its potential for high returns and unique investment value, has become one of the popular choices for investors, thereby driving the rise in Bitcoin prices.

The market’s enhanced expectations for a Fed rate cut have injected new momentum into the rise in Bitcoin prices. The Fed’s monetary policy has a profound impact on global financial markets, with its interest rate adjustments directly affecting market funding costs and liquidity. When the market expects the Fed to cut rates, it means that the cost of funds will decrease, and market liquidity will further increase. In this scenario, investors are more inclined to invest in high-risk, high-return assets to achieve higher profits. Bitcoin, as an asset with high risk and return potential, naturally attracts investors’ favor. Expectations of a rate cut will also lead to a depreciation of the US dollar, and since Bitcoin is priced in US dollars, the depreciation of the US dollar will cause the price of Bitcoin in the international market to rise relatively, further attracting global investors to purchase Bitcoin and driving its price up. Many professional institutions and analysts believe that with changes in the global economic situation, there is a high likelihood of a significant rate cut by the Fed in the near future, undoubtedly providing a favorable macroeconomic environment for Bitcoin to reach new highs in price.

5.1.2 Market Supply and Demand Relationship

The limited supply of Bitcoin is the key foundation for its price increase. According to the design mechanism of Bitcoin, its total amount is strictly limited to 21 million coins, and as the mining difficulty increases, the production speed of new Bitcoins gradually slows down. This limited supply mechanism makes Bitcoin similar to the scarcity of gold, fundamentally ensuring its stability and upward potential value. Over time, the scarcity of Bitcoin will become more prominent, the number of Bitcoins in the market will gradually decrease, while the demand may continue to increase with the improvement of market awareness and the expansion of application scenarios, thereby driving the continuous rise in Bitcoin prices. Currently, the mining difficulty of Bitcoin keeps increasing, and the output of new Bitcoins is decreasing, further enhancing the scarcity of Bitcoin and providing strong support for its price increase.

Whale hoarding behavior has significantly impacted market supply and demand, thereby driving up the price of Bitcoin. Whales refer to individuals or institutional investors who hold a large amount of Bitcoin, and their trading behavior often has a significant impact on the market. When whales hoard a large amount of Bitcoin, the supply of Bitcoin in the market decreases while demand remains relatively constant or increases, leading to an imbalance in supply and demand, thus driving up the price of Bitcoin. Whale hoarding also sends a positive signal to the market, indicating their confidence in the future value of Bitcoin, which attracts more investors to follow suit and buy, further increasing market demand and driving up the price of Bitcoin. According to Glassnode’s data, in the past 30 days, Bitcoin whales have increased their holdings by 129,000 BTC, marking one of the most significant accumulations by whales since August 2024. This large-scale hoarding behavior reduces the amount of tradable Bitcoin in the market, exacerbating the tight supply and demand relationship in the market and providing strong impetus for the rise in the price of Bitcoin.

The continuous increase in demand from institutions and retail investors is also an important factor in the rise in the price of Bitcoin. As the Bitcoin market gradually matures and gains more recognition, an increasing number of institutional investors are starting to include Bitcoin in their investment portfolios. The large-scale buying behavior of institutional investors not only increases the demand for Bitcoin in the market but also sends a positive signal to the market, attracting more retail investors to follow suit. Institutional investors typically have more professional investment teams and stronger financial capabilities, and their recognition and investment in Bitcoin further enhance the market position and value of Bitcoin. Some well-known publicly listed companies such as MicroStrategy, Tesla, etc., have announced the purchase of Bitcoin as a new type of investment asset allocation, which has garnered widespread attention and imitation in the market, driving up the price of Bitcoin. Retail investors are numerous, and their investment behavior also has a significant impact on the market. With the popularization and promotion of the Bitcoin market, more and more retail investors are starting to understand and participate in Bitcoin investments, and their increasing demand also provides some support for the rise in the price of Bitcoin.

5.1.3 Technical Development

The expansion of the Bitcoin network and the development of Layer2 solutions have provided solid technical support for the performance improvement and application expansion of Bitcoin, effectively driving its value and price up. With the continuous increase in the number of Bitcoin users and the growing demand for transactions, the Bitcoin network is facing issues of transaction congestion and high fees, which to some extent restrict the widespread application and development of Bitcoin. To address these issues, the Bitcoin community continues to innovate and upgrade, promoting the expansion of the Bitcoin network and the development of Layer2 solutions.

The scaling of the Bitcoin network, such as increasing block size or speeding up block generation, has improved the network’s transaction processing capacity, reduced transaction fees, and enabled Bitcoin to better meet the demands of large-scale transactions. Some scaling solutions, such as the implementation of Segregated Witness (SegWit), have effectively increased the transaction efficiency and security of the Bitcoin network, laying a more solid foundation for Bitcoin’s development. Segregated Witness separates transaction signature data from Bitcoin blocks, increasing the actual available space of blocks, thereby improving transaction processing capacity and reducing the risk of transaction congestion. This technical improvement not only enhances Bitcoin’s performance but also strengthens market confidence in its future development, driving up the price of Bitcoin.

Layer2 solutions are second-layer protocols built outside the Bitcoin main chain, which transfer some transactions to Layer2 for processing, reducing the burden on the Bitcoin main chain and improving transaction speed and scalability. The Lightning Network is a Bitcoin-based Layer2 solution that enables fast, low-cost Bitcoin transactions by establishing payment channels. Users can conduct multiple transactions on the Lightning Network without the need for frequent confirmations on the Bitcoin main chain, only submitting transaction records to the main chain at final settlement. This approach significantly enhances transaction efficiency, reduces transaction costs, and makes Bitcoin more feasible for everyday payment scenarios. Layer2 solutions have also brought more innovative applications to Bitcoin, such as decentralized finance (DeFi), smart contracts, expanding Bitcoin’s application scenarios and value space. These technological advancements attract more users and developers to join the Bitcoin ecosystem, increase market demand and value for Bitcoin, and drive its price up.

5.1.4 Policy and Regulation

Trump’s pro-cryptocurrency stance and potential stablecoin legislation have created a favorable policy environment for the development of Bitcoin, exerting a positive impact on its price trend. During his campaign, Trump explicitly stated his intention to make the United States the ‘world capital of cryptocurrency’ and put forward a series of policy proposals favorable to the development of cryptocurrency, such as dismissing Gary Gensler, chairman of the U.S. Securities and Exchange Commission (SEC), who holds a strict regulatory attitude towards cryptocurrency, and establishing a national strategic Bitcoin reserve. These commitments have filled the market with confidence in the future development of cryptocurrency. Investors expect that under Trump’s policy drive, Bitcoin will embrace a more relaxed regulatory environment and broader development space, leading to increased investment in Bitcoin and driving its price continuously higher.

Recently, the Trump team’s discussion with the digital asset industry about establishing a new White House position dedicated to cryptocurrency policy has further strengthened the market’s positive expectations for cryptocurrency policy. According to Bloomberg, sources revealed that the Trump team is reviewing candidates for this position, a move interpreted by the market as a further increase in the U.S. government’s attention to the cryptocurrency industry. If this position is established, it will help coordinate the work of various U.S. government departments in cryptocurrency regulation and policy-making, providing clearer policy guidance and support for the development of cryptocurrencies such as Bitcoin. This will enhance investors’ confidence in Bitcoin, attract more funds into the Bitcoin market, and drive its price up.

The possible introduction of stablecoin legislation will also have a significant impact on the cryptocurrency market, providing support for the price increase of Bitcoin. Stablecoins, as a type of cryptocurrency pegged to fiat currency, play an important role in the cryptocurrency market. However, due to a lack of clear regulatory framework, the stablecoin market carries certain risks and uncertainties. If the United States can introduce stablecoin legislation, it will help regulate the development of the stablecoin market, reduce market risks, and increase investors’ confidence in the cryptocurrency market. The regulated development of the stablecoin market will also provide better infrastructure and market environment for the development of Bitcoin and other cryptocurrencies, promoting the overall prosperity of the cryptocurrency market and thereby driving up the price of Bitcoin.

Six, BTC Price Prediction

The PI cycle indicator is a technical analysis tool used to predict the price trend of Bitcoin. It predicts the future price trend of Bitcoin by analyzing factors such as the historical cycles of Bitcoin prices and market sentiment. The PI cycle indicator believes that the price trend of Bitcoin has a certain periodicity and is closely related to market sentiment.

According to the analysis of the PI cycle indicator, the price of Bitcoin often experiences a significant upward or downward trend after reaching a certain threshold. When the Bitcoin price breaks through a key resistance level and market sentiment turns optimistic, the price of Bitcoin may continue to rise; conversely, when the Bitcoin price falls below a key support level and market sentiment turns pessimistic, the price of Bitcoin may continue to decline. Some analysts predict based on the PI cycle indicator that if the price of Bitcoin can stay above $91,400, it may rise to $155,400 in the future.

Conclusion

Regardless of investors’ risk preferences, before investing in Bitcoin, they should fully understand the basic knowledge, market characteristics, and investment risks of Bitcoin, formulate a reasonable investment plan and risk control strategy. At the same time, they should maintain rational investment, avoid blindly following the trend and excessive speculation, and ensure that investment behavior aligns with their own investment goals and risk tolerance.