As of February 19, 2025, Bitcoin’s price has stabilized around $96,000, down approximately 12% from the all-time high of $109,356 set during Trump’s inauguration in mid-January. This volatility is the result of multiple forces at play: the Federal Reserve’s decision to postpone interest rate cuts has intensified market concerns about liquidity tightening, while the Trump administration’s recent announcement of tariffs on imports from Canada, Mexico, and China has directly led to a decline in global trade risk appetite. Notably, traditional safe-haven assets such as gold and silver rose by 3.2% and 5.7% during this period, but the “digital gold” narrative of Bitcoin has not been realized in tandem. Instead, it has shown a short-term downward trend in correlation with the U.S. stock market.
This unusual phenomenon reveals a deeper structural change in the Bitcoin market. According to JPMorgan analysis, since the approval of Bitcoin spot ETFs in 2024, the share of institutional holdings has surged from 15% to 37%, leading to a 90-day correlation coefficient with the S&P 500 rising from 0.2 to 0.6. This indicates that Bitcoin is accelerating its integration into the mainstream financial system but is also subject to more complex macroeconomic pressures.
Regulatory Policy: The “Double-Edged Sword” Effect of Trump
Trump has promised to repeal SAB-121 regulations (prohibiting banks from holding crypto assets), which, if implemented, would provide a compliant entry channel for approximately $4.2 trillion in bank funds. However, his tariff policies have already led to a 15% increase in the cost of importing mining machines from China, forcing some miners to sell their BTC reserves to cover equipment premiums, creating short-term selling pressure. This policy offset effect makes Bitcoin a “microscopic reflection” of political and economic battles.
Historical data show that Bitcoin’s average price increase 300 days after the first three halvings was 650%, but the increase since the 2024 halving has been only 92%. Matrixport research indicates that daily miner sell-offs have dropped from 600 BTC to 220 BTC, but the daily net inflow of ETFs (approximately 3,200 BTC) completely offsets the supply reduction, partially invalidating the scarcity narrative.
The BlackRock IBIT ETF’s holdings exceeded 250,000 BTC in January 2025 but experienced its first weekly net outflow of $120 million following the tariff policy in February. Meanwhile, MicroStrategy bucked the trend by adding 4,200 BTC, with CEO Michael Saylor publicly stating: “The dollar credit anxiety triggered by tariffs will accelerate the recognition of BTC’s fiscal reserve attributes.”
The capacity of the Lightning Network broke through 8,000 BTC in January 2025, a year-over-year increase of 340%, with the number of merchants supporting micro-payments exceeding 1.2 million. Combined with the smart contract functionality upgraded by Taproot, Bitcoin is evolving from a “store of value” to a “payment layer + asset protocol.” El Salvador’s recent raising of $720 million through Bitcoin bonds to build renewable energy mining farms is a typical example of technology empowerment.
Risk Warning: Underestimated “Black Swan” Factors
Dollar Liquidity Trap: If the Federal Reserve raises interest rates again to curb inflation, it could trigger chain liquidations in the crypto leveraged derivatives market. The current open interest in BTC perpetual contracts has reached a record high of $32 billion, and any single-day volatility exceeding 5% may trigger billion-dollar liquidations.
Geopolitical Conflict Spillover: The European Central Bank has proposed including crypto assets in the MiCA 2.0 framework, requiring trading platforms to reserve 50% of their liquidity in euros.
Self-Reflexivity: When over 75% of AI models predict a price exceeding $150,000, it may induce retail investors to enter leveraged long positions, increasing market fragility. The DerivaDEX incident in January 2025, where contract prices deviated from spot prices by 12% due to AI signal-driven trading, has already sounded the alarm.
The price trajectory of Bitcoin in 2025 is essentially a struggle between traditional financial forces and the native crypto ecosystem. While institutions gain pricing power through ETFs, they also introduce higher systemic risks; breakthroughs in Layer2 technology and sovereign applications preserve the spark for a decentralized value network. Perhaps, as a VanEck researcher stated, “When Bitcoin becomes a macro hedge tool, it is no longer the original Bitcoin—but this is the path it must take to integrate into the global financial system.”