Sygnum: BTC exchange rate may rise sharply due to high demand from institutional investors in 2025

What’s new? Analysts at crypto bank Sygnum believe that a surge in institutional funds in 2025 could cause a demand shock for bitcoin and a significant rise in the asset’s price. According to the bank’s report, institutional capital is already having a significant impact on the spot price of BTC: every time there is a net inflow of $1 billion into asset-based spot exchange-traded funds (ETFs), the cryptocurrency’s price rises by 3-6%.

The bank’s report

What else is known? Sygnum expects this momentum to accelerate in 2025 as large institutional investors, including sovereign wealth funds and pension funds, become more active in incorporating bitcoin into their portfolios.

The bank’s chief clients officer, Martin Burgherr, attributes this prediction to the potential increased clarity of crypto regulation in the United States and the recognition of bitcoin as a central bank reserve asset.

“Our analysis shows how even relatively modest allocations from this segment can fundamentally alter the crypto asset ecosystem,” the report says.

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As for altcoins, they also need new rules different from securities laws to thrive: this would allow projects to transfer value to token holders without being burdened by excessive compliance requirements.

In recent years, the US Securities and Exchange Commission (SEC) has increasingly filed lawsuits against crypto firms for unregistered offerings of securities in the form of various tokens, noting that such assets meet the criteria of an investment contract under the Howey Test.

Such lawsuits have been filed against leading industry players including exchanges Binance, Coinbase, and Kraken, as well as fintech company Ripple, among others. The regulator’s claims concern altcoins such as SOL, ADA, FIL, DASH, XRP, and many others.

Sygnum noted that particularly important for cryptocurrencies are the Financial Innovation and Technology for the 21st Century Act (FIT21) and the Stablecoin Act, which are already under consideration or partially approved by Congress.

The bank also stresses that the US needs laws to regulate mining, decentralized finance protocols (DeFi), and non-custodial (self-storage) of cryptocurrencies by users.

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Separately, analysts noted that the lack of growth in users of most DeFi applications and usage scenarios has led to speculative investment in meme coins, with the potential for a bubble.