This time of year we like to include some forecasts for the year ahead. It started some years ago when we looked at prominent risks for investors, but now the article is more of a general overview of what we are expecting to see in the year ahead.
Bitcoin and Gold: more gains in 2025?
Bitcoin and Gold have already enjoyed singular years and the big question is whether they will be able to match that in 2025. I would argue there is a good chance of this. Many of the factors driving both assets do not look like they will disappear soon.
At the time of writing Bitcoin had just re-traced $6000 below the key $100k on remarks from the Federal Reserve that hinted at the possibility of tighter US monetary policy in 2025. In addition the Fed also ruled out the possibility of using Bitcoin in national treasury reserves.
Bitcoin remains very news driven on a day to day trading basis, but the Fed aside, more institutions are now moving to include BTC on their balance sheets. One hedge fund I spoke with this month is increasing its BTC allocation purely because they feel Bitcoin is here to stay. We will also see the new Trump administration inaugurated in January, which is likely to be very friendly to cryptocurrencies.
Gold's trends are unlikely to be reversed and $3000 gold now looks like a distinct possibility. Analysts are closely watching the buying behaviour of central banks, but beyond that, there is a sense that many parts of the world are looking for an alternative currency to the dollar as a reserve. This is not going to be the JPY or the EUR. Gold seems to be the primary alternative at the moment.
My prediction: BTC breaks $150k in 2025, gold breaks $3000.
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