Bitcoin is the largest cryptocurrency in the world, boasting the highest market capitalization level out of all the cyber assets and acting as the blueprint for all the other coins that followed in its footsteps. In November 2024, BTC recorded its most dramatic price appreciation so far, climbing to six-figure numbers in the aftermath of the US presidential elections. The results led many to believe that the market will do well in the future since the current administration is known for being appreciative of cryptocurrencies and blockchain endeavors.
Correction happened nonetheless, but most investors are convinced that they won’t affect prices in the long-term, as the losses were not very substantial. In fact, most investors believe that this is nothing more than a normal step on the way to even more considerable price growth, a belief that is fueled by historical data and movements. Many have also started looking into other assets, such as BTC futures, in order to make the most of the ecosystem and diversify their portfolios since a diverse portfolio is much more robust and has the potential to withstand price changes much more efficiently.
Corrections
In mid-March 2025, Bitcoin recorded its second-largest correction of this ongoing bullish run, according to experts and recent data. The correction took the price from its all-time high of almost $110,000 to about $80,000, a 30% retracement. Market analysis has indicated that the reason for this was the selling pressure associated with short-term holders. This is the subgroup of traders that have purchased coins anywhere between the last seven to thirty days. Studies show that they have had to deal with unrealized losses and are more likely to capitulate.
Ongoing outflows from Bitcoin exchange-traded funds totaling around $920 million during the week between March 9th and 15th also reinforce the idea that while institutional buyers have returned and are currently more active, more strength is required in order to combat the selling pressure. However, institutional demand is very likely to pick up at these lower levels and lead to price stabilization and supply absorption in the end. On top of all that, the macroeconomic situation must also be taken into account. If BTC succeeds in stabilizing in the near future, it will likely continue growing from where it left off, reaching new record levels.
The peak cycle
While the price grew tremendously during the fourth quarter of the previous year, many believe that the development is nowhere near the peak. According to this scenario, the current value decreases are nothing more than the result of macro shifts to which BTC reacted, given its decentralized nature, which makes it more vulnerable to movements such as these. Nevertheless, when the narrative changes, Bitcoin will be ready to start evolving and growing again.
The investors and market analysts who have followed the ecosystem quite closely over the last few years believe that a retracement was to be expected and that the losses are, in fact, not that substantial at all and certainly not sizable enough to make a difference in the price’s long-term journey. Conditions started to become overheated when the price pushed past $100K in such a short amount of time, and they needed to cool down before moving further. A new foundation has to be built as well. In the past, corrections such as these were common during long-term rallies, and investors have no reason to believe things are different at the moment.
Sudden change
Although the market is somewhat sluggish at the moment, there’s no reason to believe things will remain the same for very long. In fact, it is quite possible that price appreciation will kickstart soon enough and that the current trend will be reversed seemingly overnight. This is nothing new in the crypto environment; in fact, it is pretty common. Just as price decreases occur seemingly unexpectedly, so do recoveries. The next narrative is expected to revolve around the United States politics and economics, particularly the rate cuts and growing global liquidity.
Many analysts believe that the bull run has actually never ended and that the minor pullback is nothing more but a part of it. The on-chain data seems to indicate that the bull run has actually ended and that whatever price appreciation occurs in the future will be part of an entirely different movement. Yet, others point out that this could end very quickly if the Federal Reserve System begins easing during the second half of 2025 and dollar liquidity begins to grow. While there’s no certainty, the majority believe that the odds of this happening are significant.
Open interest
March has been a very eventful month for Bitcoin, with several metrics changing during this month. One of the most noteworthy is undoubtedly the $12 billion interest wipeout, which investors have started to see as part of the asset’s spring cleaning. The rest can potentially bring stellar opportunities in the short term, but a few more factors need to be considered as well. It might be the missing piece to sustain a bullish continuation and ensure that the prices remain consistently strong and elevated.
Historical trends offer an indication in this area as well. Each of the past deleveraging events similar to the current one inevitably resulted in great opportunities. The rest of 2025 is expected to be fairly positive for cryptocurrencies, with some analysts believing BTC could reach or even surpass the $200,000 level by the end of the year. Such predictions were made in the past and they may have sounded too ambitious and even a little unrealistic back then, but following the most recent rally the majority are convinced further growth is very much a possibility.
According to economists Bitcoin is currently in a supercycle at the moment, so corrections of anywhere between 20% to 40% will continue, but their impact won’t be as intense as in the past.
To sum up, although the market has dealt with reversals, this does not mean that Bitcoin is performing poorly. As always, follow your strategy to avoid losses and safeguard your list of holdings.
