Bitcoin Just Hit a New Record High. 5 Reasons It Could Soar Even Further in the Second Half of 2025.
Key Points
- Bitcoin has hit a new high, and it has several tailwinds that could keep the momentum going.
- The political climate should continue to benefit Bitcoin, especially if the Genius Act is passed.
- Bitcoin ETF inflows have been growing and recently surpassed $50 billion total.
- 10 stocks we like better than Bitcoin ›
Just two months after reaching an all-time high, Bitcoin (CRYPTO: BTC) has done it again. The leading cryptocurrency surpassed $115,000 on July 10, continuing a remarkable run. It's up 25% in 2025 at the time of this writing (July 10) and 1,150% over the last five years.
Because of how volatile Bitcoin is, predicting where the price will go next is effectively impossible. But there are several reasons it could reach even greater heights over the second half of the year.
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1. A crypto-friendly political landscape
The Trump administration has been good for the cryptocurrency market so far. President Donald Trump's pick for Securities and Exchange Commission (SEC) Chair, Paul Atkins, has said that the SEC should focus on advancing innovation in the marketplace. Under his leadership, the SEC has dropped multiple crypto lawsuits, including cases against Coinbase, Binance, and Ripple, the company behind XRP.
In March 2025, Trump signed an executive order to start the U.S. Strategic Bitcoin Reserve, a stockpile of the Bitcoin owned by the U.S. government. Arizona and New Hampshire have passed legislation for their own state-level Bitcoin reserves.
Over the second half of the year, we could see the passage of the Genius Act, a bill to regulate the stablecoin industry. The U.S. Senate passed it on June 17, and a House vote will be next. Even though the Genius Act doesn't directly involve Bitcoin, any major crypto regulation could help the industry gain legitimacy and attract more investors.
2. Increased investment in Bitcoin ETFs
The first Bitcoin exchange-traded funds (ETFs) received SEC approval in January 2024, making Bitcoin more accessible to institutional and retail investors. Bitcoin ETFs have seen a surge in investments since April, and they crossed $50 billion in net inflows on July 10, according to data from Farside Investors.
While Bitcoin ETF inflows and outflows fluctuate, the cryptocurrency's excellent performance should help it continue to draw interest. Standard Chartered, a British bank, has predicted that Bitcoin will reach a price of $200,000 by the end of the year and that ETF inflows will be a significant part of its growth.
3. Lower interest rates
Interest rates affect the stock, bond, and crypto markets, as a decrease in the cost of borrowing money tends to drive investment. In the past, low-interest-rate environments have coincided with bull runs for Bitcoin, most notably in 2020 and 2021. Rate cuts can also lead to inflation, and one of the reasons people invest in Bitcoin is as a hedge against inflation.
Analysts are expecting the Federal Reserve to cut rates during the second half of this year. CME FedWatch, a tool that measures market expectations, currently puts the odds of a September rate cut at about 68%. Goldman Sachs economists are penciling in rate cuts of 25 basis points (0.25%) in September, October, and December. Any rate cuts will likely be a tailwind for Bitcoin.
4. A weaker U.S. dollar
Another factor that affects Bitcoin is the value of the U.S. dollar. Generally, Bitcoin and the dollar have been inversely related. When the dollar declines, Bitcoin increases in price, because it's seen as a better store of value.
The U.S. Dollar Index (DXY) is already down 10% on the year, largely due to economic uncertainty related to the Trump administration's import tariffs. If the Fed decides to cut interest rates, the dollar could decline even more. Although I'm hoping the dollar rebounds, there's a strong possibility it will keep dropping, which could be beneficial for Bitcoin.
5. Investments from Bitcoin treasury companies
A recent development in the crypto space is the rise of Bitcoin treasury companies. These companies use debt or stock shares to raise money and buy Bitcoin that they then hold on their balance sheets. MicroStrategy is the most well-known example, with over 597,000 Bitcoin, but 125 public companies were holding Bitcoin in the second quarter of 2025.
Those companies purchased a record high of 159,107 Bitcoin, a 23% increase from the previous quarter. Considering how much Bitcoin has grown, it wouldn't be a surprise to see more businesses investing in it.
Despite Bitcoin's recent success, and those potential tailwinds over the second half of 2025, it's still a risky asset. As seen before, the price could plummet at any time. If you invest in Bitcoin, the safest approach is to only make it a small portion of your investment portfolio and to be ready to ride out the ups and downs.
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Lyle Daly has positions in Bitcoin. The Motley Fool has positions in and recommends Bitcoin and XRP. The Motley Fool recommends Coinbase Global and Standard Chartered Plc. The Motley Fool has a disclosure policy.
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