Bitcoin (BTC) Price Returns to Over $100K, ETH, SOL Gain as Early-2025 Crypto Rebound Extends
Bitcoin’s (BTC) price returned to six-digit territory as the largest cryptocurrency extended its early 2025 bounce on Monday.
BTC advanced towards $100,000 earlier in the trading session, then fell sharply above the threshold, rising 2.5% in an hour as traditional US markets opened. It was changing hands at around $102,000 recently, its strongest level since December 19 and up 4.3% in the past 24 hours.
The broad market benchmark CoinDesk 20 was up 3.5% over the same period, with all twenty crypto majors posting positive returns. Ethereum’s ether (ETH) climbed 2.8% to $3,700, while Solana’s SOL advanced 4.5% to above $220.
Bitcoin and the broader crypto market ended 2024 with a correction, erasing some of the gains of the massive rally since Donald Trump’s election victory as investors took profits. Prices and trading volumes fell during the holiday lull, along with outflows from spot BTC and ETH exchange-traded funds. BTC hit a local low near $91,000 on December 30, a nearly 15% pullback from its record highs.
Demand is returning while leverage remains muted
As the first full business week of the year begins and traders return to their desks after the holiday break, headlines of corporate BTC purchases continue. MicroStrategy announced on Monday bought another 1,020 BTC, while Texas-based energy management company KULR Technology Group added $21 million worth of BTC in its treasury, doubling its holdings.
Spot BTC ETFs seen $908 million in outflows on Friday in a sign of rebounding demand. Meanwhile, open interest in BTC futures is significantly lower than in mid-December in the institutional CME-focused marketplace and on a consolidated basis, indicating that the recent bounce in prices is primarily driven by buying area rather than leverage, said James Van Straten, senior analyst at CoinDesk. Funding rates are also at neutral levels across the board, CoinGlass data shows, indicating a lack of froth during the rally.
Food hazard
“Just as we have seen institutions window dressing their balance sheets thinking about risk assets for the end of the year and de-risking ahead of the holidays, we expect to see price action and recovery in demand especially as we head into what we expect to be a positive year for the asset class and the upcoming US administration,” Paul Howard, senior director of crypto trading firm Wincent, told CoinDesk in a Telegram message.
“My personal view is not to read too much into these levels (BTC above $100,000) as we can expect volatility to increase in the coming two weeks,” Howard added.
Crypto analytics firm 10x Research also predicted a rebound in crypto prices in early January towards the inauguration of President-elect Trump in a report on Monday, but warned of a monthly sell-off ahead of the Federal Reserve meeting in January.
Hawkish comments from Fed Chair Jerome Powell at the December meeting marked the start of a pullback for risk assets, and 10x Research noted that it will take time for the Fed to reverse its stance even if inflation cools further in coming months.
“The main risk remains the Federal Reserve’s communication, especially if renewed concerns about inflation emerge,” said Markus Thielen, founder of 10x Research. “We expect lower inflation this year, although it may take some time for the Federal Reserve to recognize and formally respond to this change.”
“While some enthusiasm is expected at the start of the new year, this is not the time for the same level of bullishness that we experienced from late January to March 2024 or late September to mid-December,” he added.
