Galaxy Revises 2025 Bitcoin Price Prediction
Galaxy has reduced its 2025 Bitcoin price forecast to $120,000, down from an earlier projection of $185,000. This adjustment is attributed to shifts in institutional investment flows and a noticeable decrease in market volatility.
Alex Thorn, Galaxy's head of research, suggested that Bitcoin has entered a new phase, which he described as a "maturity era." In this era, passive investment strategies are becoming increasingly dominant in shaping market dynamics.
Factors Influencing Bitcoin's Price Trajectory
Data from CryptoQuant indicates that significant Bitcoin outflows occurred in October, with "whales" transferring approximately 400,000 Bitcoin onto exchanges. Thorn highlighted on the social media platform X that investment capital has been reallocated towards other asset classes, including gold, artificial intelligence-focused stocks, and stablecoins, creating headwinds for Bitcoin's price appreciation.
A notable event, the flash crash on October 10th, resulted in cascading liquidations totaling $20 billion within a 24-hour period. Thorn characterized this event as having materially damaged the existing bull trend and marked it as the largest liquidation event in the history of the cryptocurrency market.
Bitcoin exchange inflows saw a peak in June and July, preceding the substantial outflow of over 400,000 Bitcoin in October. This surge in supply contributed to downward price pressure and a reduction in overall market liquidity.
Long-Term Outlook and Market Maturity
Galaxy has communicated to its clients that if Bitcoin's price can sustain the $100,000 level, the current bull market, which has been ongoing for nearly three years, is likely to remain structurally sound. However, the firm anticipates that future gains will be realized at a more gradual pace compared to previous market cycles.
Thorn reiterated his bullish stance on Bitcoin's long-term fundamental strength. He pointed out that the traditional cyclical market dynamics have been significantly altered by the influx of passive investments through exchange-traded funds and the ongoing absorption of Bitcoin by institutional investors.
The firm's analysis suggests that while Bitcoin's fundamentals remain robust, its trading patterns are evolving as the asset class matures. The increased involvement of institutional players is leading to lower volatility, representing a fundamental shift in how Bitcoin reacts to market pressures.