We all know that the cryptocurrency market can be a volatile place. However, recent sell pressure on Bitcoin may have investors feeling nervous. Bitcoin entered the new year above $44,000. By late May, it climbed as high as almost $70,000, only to later experience a sharp price correction. If history is any guide, this downturn could be the perfect chance to do so.
As a journalist at OverTraders.com, I’m naturally deep in the financial markets. I go beyond the headlines – I dive into the key trends driving the industry. We know that short-term volatility can be unnerving. The historical pattern of Bitcoin’s long-term course—particularly in the years between its four-year halving cycles—indicates a bright bullish potential.
In the past, Bitcoin halving events have been precursors to bull runs. These incidents halve the incentive to mine upcoming blocks. The effect of this is that they greatly decrease the rate at which new Bitcoin are created. This built-in deflationary mechanism of Bitcoin’s design ultimately leads to greater scarcity and increasing prices, something that’s just logical on many fundamental levels. In 2020, search interest for “Bitcoin halving” spiked ahead of the previous occurrence. Now, Google Trends data indicates that interest is skyrocketing — especially as we near the next occurrence, which promises to be the biggest yet.
Think of it like this: Imagine a limited edition collectible. If the manufacturer overnight decides to make half as many of those collectibles, the ones that have already been produced become more valuable. The same concept holds true for Bitcoin.
Looking back on history and using past cycles as comparison, we are witnessing this cycle play out once again. The accumulation phase, where prices are low and smart money starts accumulating positions, is often followed by a significant surge. We witnessed this massively in 2013, 2017, and 2021 where Bitcoin price underwent major bull runs after bear consolidation. The 2024–2025 Acceleration Phase is largely going according to trends we’ve observed in past cycles. Historically, the blow-off top happens much further along in the phase and provides less of a return on investment each time.
Finally, we must recognize the reality that at least during the last few years, the cryptocurrency market has been severely volatile and unpredictable. Nobody has a crystal ball, and past performance is always indicative of future results. At the same time, ignoring the patterns of history would be a big error.
The most obvious counter-argument would be the risk associated with the volatile price of Bitcoin. Sure, the price for Bitcoin can be extremely volatile—but it’s that very volatility that brings about opportunities that smart investors are quick to take advantage of. As the market continues to mature, we are witnessing greater institutional participation, which historically stabilizes prices in the long run.
Certainly, increasing institutional interest and wider adoption have become the primary bullish case for Bitcoin. The International Monetary Fund (IMF) recently folded cryptocurrencies into its world economic reporting structure. It is now a more general classification of digital assets. This news, coming from one of the world’s largest financial institutions, adds yet more credibility to the young asset class.
Forty-seven percent of hedge funds and other institutional asset managers have plans to tokenize their own assets. In 2024, institutional adoption played a huge role in bringing old school finance and crypto together. This new direction opens the door for major new innovation and entrepreneurial growth in 2025. In 2024, institutional investors started looking more specifically at sustainable practices in Bitcoin mining.
I was lucky enough to be at that conference last year. Many of the institutional investors on the other side expressed the value they see in Bitcoin as a hedge against inflation and play of long-term returns. They were attuned to the dangers, and they saw the opportunities too.
With the recent price movements, most traders with open Bitcoin positions on Binance Futures are currently long. This development shows how bullish futures traders have been, with 60.52% of traders showing a bullish sentiment. This means that most of the smart money is betting on Bitcoin becoming more expensive. After a recent wave of bullish sentiment, the broader crypto market has been riding high lately. The recent Bitcoin surge past the $87,000 barrier underscores this trend.
Then of course, as always, there are macro/cyclical factors that can make Bitcoin go either way in price. In fact, up until the end of March 2020, prices for Bitcoin and other risk assets (stocks, bonds and commodities) fell off a cliff. On a daily and weekly basis, this meant the correlation between Bitcoin and gold oscillated around zero. That was a stark drop only on a monthly basis. Bitcoin has demonstrated a safe-haven effect only for the U.S. stock market return in relation to other global stock markets.
Despite these great external pressures, Bitcoin has again and again proven its remarkable resilience and its ability to recover strongly from every major correction. In our latest crypto expert poll, Bitcoin was forecast to end 2024 at $77,000. What’s more, they think it could hit $123k by the end of 2025.
The market is changing all the time and we need to change our strategies in response to that. Follow closely and read between the lines of the data to get a sense of where the market is headed. With a long-term perspective, we can weather its inevitable ups and downs.
Today’s selling pressure on bitcoin might seem ominous. Remember, corrections are normal in any market cycle. Given Bitcoin's historical performance, deflationary nature, and increasing institutional adoption, this dip might just be the buying opportunity you've been waiting for. Perform your own due diligence, think about your own appetite for risk, and invest wisely.
