Bitcoin Poised for 2025 Rally on U.S. Economic Growth and Legislation

Coinbase Research has released a report indicating that Bitcoin (BTC) is poised for a rally in the latter half of 2025, driven by an improving U.S. economic outlook and progress in cryptocurrency legislation. The report highlights that the resilience of the U.S. economy and the advancement of stablecoin legislation are key factors that will likely boost optimism for Bitcoin. However, the fate of altcoins remains less certain, as their performance is not as directly tied to these macroeconomic and regulatory developments.

The positive macroeconomic outlook for the U.S. is expected to create a favorable environment for Bitcoin. As the economy continues to grow, investors may seek out Bitcoin as a store of value and a hedge against inflation. This increased demand could drive up the price of Bitcoin, making it an attractive investment option. Additionally, the progress in cryptocurrency legislation is expected to provide greater regulatory clarity, which could further boost investor confidence in the cryptocurrency market.

The report also notes that the advancement of stablecoin legislation is a significant development for the cryptocurrency market. Stablecoins, which are cryptocurrencies pegged to the value of a stable asset such as the U.S. dollar, have become an important part of the cryptocurrency ecosystem. The progress in stablecoin legislation is expected to provide greater regulatory certainty for stablecoins, which could increase their adoption and usage. This, in turn, could have a positive impact on the overall cryptocurrency market, including Bitcoin.

Meanwhile, public companies are increasingly adding crypto to their balance sheets, aided by a 2024 rule change allowing "mark-to-market" accounting for digital assets. While this trend is expanding demand, it’s also introducing new systemic risks. Firms that fund crypto buys with convertible debt may be forced to sell if refinancing options dry up or prices fall sharply.

Regulatory developments are also expected to reshape the market. The Senate recently passed the GENIUS Act, a bipartisan stablecoin bill now heading to the House. A broader market structure bill, the CLARITY Act, aims to define the roles of the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) in overseeing digital assets. If passed, it could clarify rules for both issuers and investors.

Separately, the SEC is considering more than 80 crypto ETF applications, including multi-asset funds and proposals involving staking and altcoins. Some rulings could be made as early as July, and the rest are likely to be finalized by October.

Overall, bitcoin appears poised to benefit from both macro and structural tailwinds in the second half of the year, while the outlook for altcoins will depend on navigating a more complex and still-evolving regulatory and liquidity environment, according to the report.

The report also acknowledges that the fate of altcoins is less certain. Altcoins, which are cryptocurrencies other than Bitcoin, have historically been more volatile and less predictable than Bitcoin. Their performance is often influenced by a variety of factors, including market sentiment, technological developments, and regulatory changes. As such, it is difficult to predict how altcoins will perform in the second half of 2025.

In conclusion, the report from Coinbase Research suggests that Bitcoin is poised for a rally in the latter half of 2025, driven by an improving U.S. economic outlook and progress in cryptocurrency legislation. While the fate of altcoins remains less certain, the overall outlook for the cryptocurrency market appears to be positive. Investors should keep an eye on these developments and consider how they may impact their investment strategies.