Hey Leo & Hivers!
2024 was nothing short of a wild ride for investors. The year started with an optimistic bang as BTC ETFs gained approval and the market soared. However, the initial enthusiasm gave way to months of stagnation in crypto, even as equities edged higher, driven by the AI revolution narrative. By August and September, panic set in with sharp pullbacks across markets. Then came November, when the Fed’s shift in monetary policy and Trump’s market-friendly return as president sparked a massive pump, propelling BTC to a historic $108k ATH. But now, just five weeks into 2025, the market seems to be staring into an uncertain future.
As we look ahead, two competing narratives dominate the discussion, and both could dramatically shape the direction of the markets in the coming year.
The Bullish Narrative
Crypto bulls believe that Trump’s administration could be a game-changer for the space. His crypto-friendly policies promise regulatory clarity, a revamp of the SEC, and even the creation of a strategic Bitcoin reserve at the Treasury. With government support for miners and blockchain innovation, the argument goes, the U.S. could lead a new wave of adoption, unlocking trillions of dollars in institutional investment.
Add to that the ongoing Federal Reserve policy shift. The Fed, desperate to avoid a recession, is incentivized to maintain a dovish tone and continue cutting rates. This dovish stance helps prop up market sentiment, keeping layoffs in check and preserving the status quo. Paired with post-halving Bitcoin momentum and historical cycles pointing to a bull run throughout 2025, the stage seems set for another explosive year in crypto.
Bulls also point to past cycles: the 2017-2018 and 2020-2021 bull runs were fueled by favorable macroeconomic conditions—low interest rates, high liquidity, and strong market confidence. The hope is that 2025, despite some headwinds, will mirror these cycles, bringing a booming alt-season and massive growth across the crypto space.
The Bearish Reality
While the bullish case sounds promising, the road ahead is riddled with potential obstacles. For starters, many of Trump’s proposed policies require Congressional approval. Regulatory clarity and transformative crypto laws won’t happen without bipartisan support—something that has been nearly impossible in recent U.S. politics. Furthermore, his foreign policy and economic proposals, such as tariffs, could inject massive uncertainty into the markets.
The last time tariffs were introduced in 2018, the U.S. faced significant volatility and rising inflation, which hurt sectors like manufacturing and agriculture. The current market is far more fragile than it was back then, and similar policies could trigger panic rather than growth.
The Fed, while appearing dovish, faces its own paradox. Cutting rates further reduces its ability to stimulate the economy in the event of a downturn. Meanwhile, the yield curve, which was inverted for over six months, has recently un-inverted—a signal that has historically preceded every major recession. If history holds true, a recession may already be on the horizon, raising serious doubts about whether the market can sustain its current trajectory.
The Crypto Wildcard
BTC has hit new all-time highs, but most altcoins remain far from their previous peaks. Many see this as evidence that there’s still significant room for growth. The total market cap aligns with historical cycles, suggesting a potential surge, but the current economic conditions are unlike anything we’ve seen during previous bull runs.
In 2017-2018, Trump’s tax cuts and low interest rates fueled speculative growth. The 2020-2021 bull run coincided with unprecedented fiscal stimulus, with governments worldwide injecting liquidity into the economy. In contrast, today’s environment features high consumer debt, elevated borrowing costs, and ongoing global uncertainty. A bull run under these conditions would defy historical precedent, leaving many wondering if the halving-driven cycle alone can sustain the market.
What’s Next?
The market is at a crossroads. On one side, a strong bullish case fueled by favorable policies, post-halving momentum, and a historical tendency for explosive growth. On the other, significant economic headwinds and uncertainties that could derail the recovery before it gains full steam.
What do you think, Hivers? Will 2025 continue the bull market, or are we in for a major pullback into a bear cycle? Share your insights below—bull or bear, let’s hear your take!
**Let’s discuss! **
*PS. You may know us as Musicians, but we are also very interested in the market and geo-politics. To be an independent artist, it is the same as running your own business. Having a good feel for micro and macroeconomic forces and trends is an important way for us to continue to live doing the thing we love. *
Posted Using INLEO
I’d say we will still see a bull run.
Maybe hovering around 100k for another few months then 1 more push higher ATH.
I’d be surprised to see it go over 135k
115-125 seems very attainable still.
March or May perhaps.
I too am a músico that doesn’t pretend to really know anything.
End of Q1 2025 was our original guess for the Top to come in. Still feels more uncertain than before, but still positioned for that
I'm no trader and only really have Hive stuff that I earned. I don't trust Trump on much and he may only have talked up crypto for attention. Musk has pushed DOGE, but that's not exactly a good coin. He just likes to stir things up and doesn't need the money anyway.
I expect we will see plenty of surprises. I think one of the main things we need are reliable ways to extract crypto for fiat as that can be tricky. Ideally we should be able to spend it directly.
Anyway, I shall keep on with Hive as I believe it can do a lot for many people who need it.