Summary Bitcoin's recognition as "Digital Gold" and increasing institutional adoption, including potential national reserves, signal significant growth potential for 2025. Despite market skepticism, I believe the Trump administration will swiftly implement a U.S. Bitcoin reserve, driving prices higher. Major corporations and smaller firms are increasingly adopting Bitcoin, reflecting broader acceptance and integration into diverse sectors. Retail and institutional investors are holding Bitcoin long-term, indicating its growing acceptance as a store of value and investment asset. 2025 will be a pivotal year, I have decided to update my recommendation to STRONG BUY. Introduction The first time I heard about Bitcoin USD (BTC-USD), it was in 2017 during an economic class. At that time, my economics teacher, for which I have a huge respect, gave her a view about BTC. Her view was rather pessimistic, arguing that BTC was not money as it wasn't issued and managed by a central bank. She was a very good teacher, and I took at that time everything she said very seriously. In a sense, at that time, her statement prevented me from looking deeper into BTC when it was trading around $8000, which is 12x lower than the level it is today. Should she have made a more nuanced or positive statement, I might have investigated BTC sooner. In the end, I invested in BTC in 2020 which still gave me attractive entry points when considering today's levels. When I look back at all these years, I realize that BTC has gone a long way. It is still considered a speculative asset, but more and more investors are considering implementing a BTC allocation within their portfolio. This has been notably facilitated by ETF approvals at the beginning of 2024. Even though it is not considered money, BTC is now widely considered as "Digital Gold". Jerome Powell, SEC Chairman recently stated that BTC is a competitor for gold . Who would have thought back in 2017 or 2020 that an SEC chairman would make such a statement? To me, it represents a major step. It means that BTC has become too important to ignore. What was initially a cypherpunk - libertarian idea has spread and entered almost everyone's mind in less than two decades. BTC has proven to be valuable and useful, and I believe it is now here to stay. Since the beginning of my BTC journey, I am very proud of the way travelled, but I still believe that there is a long way to go and a lot more potential going into 2025. I also want to pursue my journey with you. In this sense, in this article, I'll share why I believe 2025 will be a pivotal year for BTC. Before diving into my analysis, I wanted to wish all of you dear readers and followers a wonderful year 2025. May this year be great for you and your loved ones, characterized by health, love, and success. U.S. Bitcoin Reserve: Market is Doubting, you Shouldn't Since my last article , BTC has remained in good shape as I expected, and printed a +23% performance. Since then, BTC has reached a new ATH near $107,000. Now that I am writing this article, we are close to $99,000, which represents, to me, a healthy pullback. In terms of sentiment, the Bitcoin Fear and Greed Index remains in the 'Greed' territory, which I view positively. Alternative, Author The market is not yet in complete euphoria despite the strong 2024 performance, leaving room for further potential appreciation. In my last article, I mentioned the potential U.S. BTC reserve as a major growth driver. Supported by many Republicans, both Bitcoin and the crypto industry are, in my opinion, poised to outperform in the upcoming year. Despite the political will that has been shown, investors' optimism seems to have slightly faded, especially regarding the idea of a national BTC reserve. As of today, on Kalshi , 51% of investors believe that Trump will create a National Bitcoin Reserve, down from 67% in November. Kalshi Following the same logic, investors have revised downward their expectations of the speed at which the BTC reserve might be adopted. At the beginning of November, according to Polymarket , 60% expected a BTC reserve to be implemented in the first 100 days of Trump's mandate. These probabilities are now standing at 28%. Polymarket I believe these odds are rather conservative, not to say pessimistic. It appears that the market isn't fully convinced that the BTC reserve will become a reality. In my opinion, the Trump administration will try to implement this reserve as soon as possible. As this administration plans to support the crypto industry, it will certainly drive prices higher. Thus, I don't see why the Trump administration would wait to buy an asset that might get more expensive in the future. Also, considering a Republican majority in both chambers , I am convinced that the BTC reserve could be approved in the first 100 days of Trump's term, as highlighted by Senator Cynthia Lummis . U.S. BTC Reserve - An Idea that goes Beyond Bi-Partisan Divisions Another thing I would like to mention: The Democrats don't appear to be opposed to BTC. Why? Because if they wanted to, Democrats could have sold 213,000 BTC owned by the US government just before the end of Biden's term. Democrats could have impacted Republican plans just like they did on the environment by announcing, on Monday, the ban on new offshore drilling across a vast maritime area to counter Trump's promise to boost oil and gas production. In this sense, bipartisan adoption is likely and will be crucial to see a BTC Reserve adopted in the short run and maintained over the long run. Countries Likely to Follow the U.S. Bitcoin Reserve Path - My 2025 Bingo List Should the US embrace BTC, I expect many countries to follow. For now, only 9 countries hold BTC. Bitwise I expect these countries to follow should the U.S. adopt a BTC national reserve: Switzerland: The SNB now faces an initiative proposing the SNB hold part of its reserves in Gold and Bitcoin. Note that Switzerland is already recognized for its crypto-friendly environment, featuring low tax rates and its renowned "Crypto Valley," which hosts major players like Ethereum and Cardano. Japan: where an increasing number of officials have expressed openness to the idea , signaling they might follow the U.S. should it adopt a BTC strategic reserve. The United Arab Emirates : with Dubai standing out as one of the most attractive and crypto-friendly hubs in the world. South American countries : inspired by El Salvador's success, particularly Argentina under Milei's leadership , which has shown a strong inclination toward BTC. Corporations are embracing Bitcoin Since our last article, we have seen more and more companies start buying BTC or increasing their BTC reserves. Below is a list of corporations holding BTC on their balance sheets: HOLD15Capital It is impressive to know that all the Bitcoin held by these 60 companies represents 2.8% of the BTC total supply. Depending on whether you see the glass half full or half empty, this represents an important number given that BTC is a quite young asset, but also a low number when considering rising adoption. I expect 2025 to be a pivotal year for BTC supported by an increasing institutional adoption no matter the companies' sizes. Large Companies - The Amazon Case In my previous article, I mentioned Microsoft Corporation's (MSFT) potential BTC adaptation that was debated in December by shareholders. They voted against the resolution . This isn't dramatic. The simple fact that this question comes to the attention of giant companies like hyperscalers is in my view very positive. There is another major company that will have to debate whether it decides to adopt BTC. This company is Amazon.com, Inc. (AMZN). This matter will be debated, and a decision will be taken in the April Shareholder meeting. Interestingly, I believe that AMZN is perhaps one of the hyperscalers for which it would make more sense to be invested and also accept BTC. Historically, AMZN has been rather open to cryptocurrency and blockchain technologies with different patents issued related to supply chain tracking, data analysis, and BTC transactions. Even more suspicious, many have forgotten that in 2017, AMZN bought several new domain names such as 'amazonethereum', 'amazoncruptocurrency' and 'amazoncryptocurrencies' showing interest and an open-mindedness towards crypto. Finally, when we think about AMZN, we mainly think about its retail platform, which accounts for 40% of the firm's revenues. Considering the significant portion of BTC held by individuals, it seems logical to me that the world's largest online retailer decides to follow Tesla's 2021 decision and adopt Bitcoin as a payment method. River It might be a risky prediction, but I have the conviction that it will happen sooner rather than later. Smaller companies - The Biotech Case Smaller companies are also considering BTC to diversify their treasury. Some of them have already crossed the line. Here's an interesting example: a list of biotech companies like Acurx Pharmaceuticals, Inc. (ACXP) and Enlivex Therapeutics Ltd. (ENLV), both bought recently for $1m. worth of BTC. Here's how ACXP CEO justified this acquisition according to fiercebiotech : As demand for Bitcoin grows, and so does its acceptance as a major and primary asset class, we believe that Bitcoin will serve as a strong treasury reserve asset for cash not needed over the next 12 to 18 months. He also stated: Its limited supply and inflation-resistant characteristics provide a functional store of value," the CEO added. An intriguing example, given that many biotech companies often hold significant amounts of cash that remain unused for long periods of time. Bitcoin Backed Convertible Debt - The New Trend These Biotech companies are using cash, but many other companies like Metaplanet or MicroStrategy Incorporated (MSTR) are now using debt to finance their acquisitions. According to Cointelegraph : Metaplanet holds 1,762 Bitcoin and wants to increase its stash by 467% to 10,000 using a mix of equity and convertible bonds. This trend is booming. As mentioned in research recently published by Barclays, 6% of the current convertible universe is tied to digital asset companies. Barclays Retail Investors - A Strong Appetite for BTC's Value Proposition This trend of issuing debt to finance Bitcoin acquisition is coupled with another trend that is catching up and can be seen through the graph below: ZeroHedge Impressive, isn't it? In one year, the iShares Bitcoin Trust ETF (IBIT) accumulated 55,000 BTC. As of today, ETF holds close to 4.5% of the total BTC supply, showing how strong retail interest is for BTC. Major asset managers have now understood BTC's value and are now proposing to their clients' solutions to get exposure to this asset class. BlackRock Bitcoin Presentation (BlackRock) Their main arguments are simple: BTC is under-owned and can be considered as digital gold, in this logic its valuation should catch up to gold leaving room for a huge potential even for investors who are late to the game. Investors Now Appear To Be Here For The Long Term Finally, I wanted to share one last bullish chart with you. Pierre Rochard - Riot Blockchain This metric measures the median age of BTC that has not yet been spent. A higher median age means that more BTC has remained untouched for a longer period, which suggests that holders are not actively moving their coins. Even though lost BTC could skew the graph a bit, the trend still suggests that a large portion of BTC holders aren't actively trading or spending their coins supporting the idea that BTC is increasingly being considered a long-term store of value for investors, especially since less than 20% of Bitcoin are considered lost. Risks It is obvious that my thesis is based on assumptions and elements that I expect to happen soon. However, the drivers I have identified are not guaranteed. There is, of course, a probability that external factors could impact these drivers and thus impact negatively my bull thesis. A poor macroeconomic environment could weigh heavily on investor sentiment. If inflationary pressures persist or if central banks maintain a more aggressive stance than anticipated, risk assets like Bitcoin could be negatively impacted. Geopolitical tensions or regulatory developments could also introduce significant uncertainty if some U.S. enemies like Russia or China were to become pro-BTC for the wrong reasons. Finally, MSTR's large Bitcoin holdings make it a key company to watch, as any financial trouble it faces could also pose a risk to Bitcoin's price in the future. Conclusion Since my first BTC purchase in 2020 and my articles on that matter on Seeking Alpha, I have managed to be right and accurate in the analysis and predictions I have made. As a matter of fact, since my initiation, BTC has performed by 78% vs. 11% for the NASDAQ 100-Index (NDX). Although my past predictions do not guarantee the accuracy of my future predictions, I still hold the conviction that 2025 is set to be a major and historical year for BTC, with stars aligned, thanks to massive adoption coming from states, institutional investors, and retail investors. Given the current price level, knowing that we are sitting 7% below the previous ATH, I consider current levels as interesting to strengthen a position or to build one if you haven't invested in BTC yet. For all the reasons mentioned above, I have decided to update my recommendation on BTC to STRONG BUY.
