Bitcoin's recent price behavior reflects a market in transition rather than a failing rally, according to Alex Thorn, head of firmwide research at Galaxy. Thorn nonetheless cut his year-end price target by roughly 30% in an interview released Oct. 23. Thorn lowered his projection to $130,000 from earlier calls of $150,000 and $185,000, citing US-China tariff risks as the primary factor constraining near-term gains despite continued institutional adoption.
Key Market Indicators and Forecast Adjustments
- •Galaxy's Alex Thorn reduced his Bitcoin year-end forecast to $130,000 from $185,000, blaming tariff uncertainty rather than fundamental weakness for capping gains at current levels.
- •Bitcoin's 90-day realized volatility stands near 29, well below 2017 and 2021 cycle peaks, as ownership transfers from early adopters to institutional investors through spot ETFs and wealth platforms.
- •Three of the four largest global custody banks have launched or announced digital asset services, while Morgan Stanley now permits advisors to recommend 2-4% Bitcoin allocations through spot ETFs.
Tariff Uncertainty Stalls Rally
Thorn described the current price action as "sort of crab," with Bitcoin "still climbing a wall of worry" despite grinding through incremental all-time highs. The volatility has been tamed, he said, but the upside remains capped by factors outside the cryptocurrency market itself.
The primary culprit, according to Thorn, stems from statements made Oct. 10 regarding potential 100% tariffs on Chinese goods. Those comments triggered a leverage washout that halted what had been a strong October for Bitcoin.
"Quite simply an abatement of the tariff war between the US and China would sort of set us right back on course in risk markets," Thorn said.
He dismissed concerns about structural problems with Bitcoin's fundamentals or adoption trajectory. "I don't yet think it's more existential than that for the bull market," he said. The issue is exogenous risk appetite, not the asset itself.
Thorn expects some form of compromise rather than an extended trade conflict. He downplayed the next Federal Reserve meeting as a catalyst for Bitcoin's direction, though he acknowledged the central bank's proprietary data could carry unusual weight given delays in official economic releases. "They're going to have data. We don't have data, but they'll share the data," he said.
Institutional Shift Reshapes Market Character
The researcher framed Bitcoin's price path this year as a volatile stair-step pattern, moving from around $100,000 to $74,000, then to $126,000, and settling near $108,000 before the recent push higher. Bitcoin traded at $111,183 at press time. That choppy movement, combined with declining realized volatility, signals a changing market structure rather than weakness.
"Significant distribution from old hands to new hands" has created resistance at key levels, Thorn said, but the process widens ownership and matures the market. He pointed to the $100,000 level as a psychological and structural dividing line. "Maybe we delineate there the pre-$100K Bitcoin world versus the post-$100K Bitcoin world. I think it's going to look a lot different," he said.
The shift involves passive, long-term institutional allocators steadily absorbing supply from earlier cohorts.
Thorn cited BlackRock and Fidelity promoting Bitcoin as "digital gold," and noted Morgan Stanley's recent move allowing financial advisors to recommend small allocations of 2-4% through spot exchange-traded funds. Three of the four largest global custody banks have either launched or announced digital asset custody services, with one major holdout remaining.
"The era of the early Bitcoin adopter is now finally, I think, fully coming to an end," Thorn said. "And now you're in whatever that stage is—this is going to be a widely owned macro asset in everybody's portfolio."
The dynamics explain why Bitcoin hasn't yet traded like gold, despite narrative comparisons. Markets move on marginal flows, Thorn said, and those margins still treat Bitcoin as a risk asset. Gold's recent strength has come "all offshore," with buying concentrated "during European and Asian hours," consistent with foreign central banks and sovereign wealth funds reducing US exposure. Bitcoin, by contrast, remains pinned to risk appetite.
That divergence should narrow as more supply moves into registered investment advisor platforms and passive vehicles, Thorn argued. "BlackRock's chilling the digital gold narrative," he said, adding that as institutional ownership grows, Bitcoin "will trade a lot more like a risk-off, non-sovereign scarcity hedge asset."
Key Terms and Market Context
Bitcoin ETFs, or exchange-traded funds, allow investors to gain exposure to the cryptocurrency through traditional brokerage accounts without directly holding the digital asset. Spot ETFs, approved in early 2024, hold actual Bitcoin rather than derivatives, making them attractive to institutional investors who face regulatory or operational hurdles with direct custody.
Realized volatility measures actual price fluctuations over a specific period, typically 30, 60 or 90 days. Lower readings suggest price stability, which institutions generally prefer.
The current 90-day figure near 29 represents a significant decline from historical Bitcoin volatility.
Custody banks provide safekeeping and administrative services for financial assets. Their entry into digital asset custody removes a major barrier for institutional adoption by offering insured, regulated storage solutions that meet fiduciary standards.
Broader Macro Pressures Add Complexity
Thorn identified the artificial intelligence capital expenditure boom as "the most important trend in markets," though its implications for Bitcoin remain uncertain. The spending wave could either be nearing a speculative peak or entering a phase similar to the Manhattan Project, with national-priority backing. The latter scenario would create knock-on effects for liquidity, interest rates, energy markets and semiconductors that extend beyond typical technology cycles.
For Bitcoin specifically, tariff policy remains the decisive near-term variable. The microstructure—passive ETF buying absorbing original holder supply at round-number price levels—explains why the chart feels both heavier and more stable than previous cycles. The market no longer produces the "massive uplifts" that once followed fresh all-time highs, Thorn said.
Outlook: Persistence Over Explosive Growth
Thorn's outlook emphasizes persistence rather than explosive growth. The bull market hasn't ended, he maintains, but it has changed character. Distribution from concentrated holders to diversified institutional portfolios creates near-term resistance but builds a more sustainable foundation for future gains. The tariff overhang represents the main obstacle to renewed momentum in risk assets, including Bitcoin. An easing of trade tensions would likely restore the rally trajectory that stalled in October, while prolonged uncertainty could extend the current sideways pattern.