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Investment company Galaxy lowered its 2025 Bitcoin price forecast to $120,000 from $185,000, citing several headwinds and dampened price volatility due to passive investment flows into exchange-traded funds (ETFs) and financial institutions.
Factors such as whales dumping 400,000 Bitcoin (BTC) onto the market in October, along with rotations into other investment narratives such as gold, AI and stablecoins, in addition to leveraged liquidations, have put a damper on BTC price, Alex Thorn, Galaxy’s head of research, said on Wednesday.
“Bitcoin has entered a new phase, what we call the ‘maturity era,’ in which institutional absorption, passive flows, and lower volatility dominate,” Thorn wrote on X. “If bitcoin can maintain the $100,000 level, we believe the almost three-year bull market will remain structurally intact, though the pace of future gains may be slower.”
Bitcoin exchange inflows, the amount of BTC sent to exchanges, totaled over 400,000 BTC in October and reached a local peak in June and July. Source: CryptoQuantThe flash crash from Oct. 10 — which triggered about $20 billion in cascading liquidations within 24 hours, the largest liquidation event in crypto history — has “materially damaged” the bull trend, Thorn wrote.
Despite the revised price forecast, Thorn said he remains bullish on Bitcoin’s price fundamentals and long-term performance, but cyclical market dynamics, which have been a core feature of the crypto market, have been disrupted.
Related: Three things that must happen for Bitcoin to avoid the bear market
Is this the start of the next Bitcoin bear market?
Crypto markets went into panic mode on Tuesday, as $1.3 billion was liquidated, causing BTC to dip below $100,000 for the first time in four months.
BTC dropped below its 365-day moving average, a dynamic support level, on Tuesday and Wednesday, sparking fears of continued pressure to the downside and the start of the next Bitcoin bear market.
Bitcoin has dipped below its 365-day exponential moving average and the $100,000 level. Source: TradingViewThe price of BTC fell by over 20% from its all-time high of above $126,000 during the market downturn.
While some market analysts define a 20% drop or more as bear market territory, others argue that a decline of 20% or more is normal.
“During this cycle, the typical correction signature has been between 20-25%, with a couple of 30% ones. This current correction is at 21%, totally within the normal parameters,” trader Lourenço VS wrote on X.
Magazine: Bitcoin to see ‘one more big thrust’ to $150K, ETH pressure builds: Trade Secrets
