Why is the 2024-25 Bitcoin bull market completely different from previous ones

Since its inception in 2009, Bitcoin has experienced multiple cyclical bull and bear markets. However, compared to historical patterns, this current upward cycle is undergoing a fundamental transformation—driven by the influx of institutional capital, the refinement of regulatory frameworks, and the approval of ETF products—reshaping the investment logic of cryptocurrencies.

From Digital Assets to Mainstream Financial Instruments

Bitcoin (BTC) has completed a stunning transformation from a niche technological experiment to a global asset over the past 15 years. The current price is around $87.12K, more than doubling the $40,000 seen at the beginning of 2024.

This growth is not illusory. After the US SEC approved the first spot Bitcoin ETF in January 2024, what did the market see? Genuine institutional funds flowing in. In just the first month, these ETFs attracted over $1 billion in net inflows. By November, total inflows exceeded $2.8 billion, even surpassing the performance of traditional gold ETFs during the same period.

Wall Street giants like Blackstone and Fidelity are not just speculating—they are strategically positioning. This is different from the retail-driven price surges of 2017, when ordinary investors chased prices frantically and got trapped at around $20,000.

Why Past Bull Markets Failed

To understand why today’s market is different, let’s look at past lessons.

The First Major Surge in 2013: Bitcoin soared from $145 to $1,200, a 730% increase. It sounds crazy, but at the time, the main drivers were media hype and a small circle of early believers. The Mt. Gox exchange hack shattered this rally, causing Bitcoin to fall below $300.

The ICO Frenzy of 2017: Prices jumped from $1,000 to $20,000 (a 1900% increase), becoming a hot topic overnight. But all of this was built on retail FOMO—fear of missing out. When China banned ICOs, the market started to collapse. By the end of 2018, Bitcoin had fallen to $3,200, an 84% decline.

Institutional Testing in 2020-2021: A different narrative emerged. Companies like MicroStrategy and Tesla began purchasing Bitcoin as part of their asset allocation. Prices rose from $8,000 to $64,000. However, regulatory uncertainties and environmental concerns also surfaced, leading to a subsequent drop of over 50%.

These cycles share a common trait—lack of institutional support. Retail investors come and go, companies hesitate and retreat. But the 2024-25 crypto bull run is different.

Why Today’s Bull Market Can Be More Stable

1. Regulatory Framework Has Matured

The US SEC no longer says “no,” but “how to do it.” The approval of spot ETFs indicates that the US financial system has found a way to accommodate Bitcoin. This opens the door for “conservative” funds like pensions and insurance companies. They previously avoided Bitcoin not because they didn’t want its returns, but because they couldn’t find compliant investment channels.

2. Institutional Holdings Data Speaks

Data doesn’t lie. By the end of 2024, the total amount of BTC held by all Bitcoin ETFs exceeded 1 million coins. MicroStrategy alone holds over 467,000 coins. What does this mean? It means these BTC are not on exchange order books, reducing liquidity and tightening supply.

3. Supply Economics

Bitcoin’s total supply is capped at 21 million coins. The halving events occur roughly every four years, reducing mining rewards by half. The fourth halving is scheduled for April 2024. Historical patterns show that within 12-18 months after halving, prices tend to hit new highs. Why? Because suddenly, the newly mined Bitcoin decreases by half, while demand remains steady.

4. Macroeconomic Environment

Inflationary pressures persist, and interest rate policies remain uncertain. In this environment, Bitcoin’s appeal as “digital gold” increases. Institutional investors have long recognized that in an era of fiat currency devaluation, holding assets unaffected by central bank policies is essential.

What Will Trigger the Next Phase

Policy Support Possibilities

Senator Cynthia Lummis proposed the “Bitcoin Act” in 2024, recommending that the US Treasury acquire 1 million BTC over five years as strategic reserves. It sounds like a fantasy, but the logic behind it is real—strengthening the US dollar reserve and competing for leadership in financial innovation.

If the US actually takes such steps, other central banks might follow suit. Bhutan has already accumulated 13,000 BTC through its national investment fund, and El Salvador has incorporated Bitcoin into its legal framework since 2021. Once major economies include Bitcoin in their national reserves, the game changes forever.

Technological Upgrades

Bitcoin is considering a code upgrade called OP_CAT, which would significantly enhance network processing capacity and potentially enable Bitcoin to support DeFi applications. Imagine if Bitcoin could run smart contracts like Ethereum—its application scenarios would expand exponentially. This isn’t happening next year, but perhaps within the next two or three years.

Practical Advice for Investors

Don’t Repeat Past Mistakes

Retail investors bought in at around $18,000 in 2017 and got trapped in 2018. Don’t jump in just because of news. Set stop-loss points and develop clear exit strategies.

Choose Reputable Platforms

Not all exchanges are equal. Opt for licensed platforms with comprehensive risk control systems (like established exchanges such as Gate.io). Use layered wallets, cold storage, and two-factor authentication as basic security measures.

Diversify, Don’t Just Buy More Coins

While Bitcoin is the main player, don’t put all your funds into one asset. Allocate across different risk levels and rebalance periodically.

Track Key Indicators, Not Just Price

Don’t just stare at candlestick charts. Look at on-chain data: net Bitcoin outflows from exchanges (indicating accumulation rather than selling), whale wallet movements, and new institutional holdings. These are more reliable than technical analysis.

Manage Taxes and Psychology

Crypto gains can be substantial, but tax costs are also high. Tax laws vary by country—plan ahead to avoid surprises. Also, market psychology is intense; being able to avoid over-leverage during bull markets and panic selling during bear markets is key to long-term success.

History Won’t Simply Repeat, But It Rhymes

Bitcoin’s journey from a line of code in 2009 to a part of global asset allocation proves its resilience.

The past three major bull markets all failed in some way—lacking infrastructure, institutional recognition, or stable funding sources. But the current crypto bull run in 2024-25 seems to have all three conditions in place.

Of course, all investments carry risks. Policies may shift, economies may recession, and new technologies may emerge. But rather than obsess over short-term volatility, understanding the deeper logic—why smart money is allocating to Bitcoin now—is more important.

For ordinary investors, the key is: understand what you are buying, know how much risk you can bear, and prepare for the long term. The next Bitcoin bull market could create new wealth opportunities or trap the unwary again. The choice is in your hands.