Following Bitcoin's steady rise starting near $98,000 on June 22, BTC today broke through $120,000, hitting a new all-time high.

Image Source: TradingView

Driven by a combination of multiple macroeconomic and industry-specific factors, the momentum of this rally cannot be explained by a single event. From corporate buying sprees, policy maneuvers, tech stock correlations, to changes in investor structure and evolving market sentiment, this Bitcoin surge is not just a leap in price but also a reflection of a reassessment of the status of crypto assets.

Institutional FOMO Propels Bitcoin Price Surge

The continued accumulation by institutions has been one of the key drivers of this price surge. According to ARK Invest's June "Bitcoin Monthly" report, the proportion of Bitcoin held by long-term hodlers has risen to 74% of the total supply, the highest level in 15 years. This metric indicates that despite a decline in short-term buyer activity, "diamond hands" are holding strong, steadily accumulating in a low volatility range.

On July 9, Glassnode tweeted that the Bitcoin RHODL ratio has started to rise, reaching the peak of this cycle. This signal suggests a shift in market structure, with more wealth controlled by long-term holders, while short-term activity spanning 1 day to 3 months remains subdued. Historical data suggests that such a turning point often indicates a shift in market cycles and a cooling of speculative fervor.

The RHODL ratio is a Bitcoin on-chain metric used to measure the difference in Bitcoin holdings between short-term and long-term holders, providing insights into market cycles and investor behavior.

Image Source: Glassnode

Simultaneously, BlackRock's iShares Bitcoin Trust (IBIT) has accumulated over 700,000 BTC, accounting for approximately 3.33%. Bloomberg data shows that the ETF's annual management fee revenue has surpassed BlackRock's flagship product, the S&P 500 ETF (IVV), becoming a profitability showcase for traditional financial institutions venturing into the Bitcoin market.

Since July, a trend led by US-listed companies known as the "Bitcoin Treasury Reserve" wave is rapidly expanding, particularly driven by pioneers in traditional industries such as hotels, real estate, and food. Mexican hotel and real estate operator Murano (NASDAQ: MRNO) announced the initiation of a Bitcoin reserve strategy, signing a subscription agreement of up to $500 million and having acquired 21 BTC. The company plans to enhance asset liquidity and convert it into long-term crypto reserves through the sale of real estate and the introduction of Bitcoin payments. Meanwhile, Japanese hotel chain operator Metaplanet increased its holdings twice in late June and early July, with total Bitcoin holdings surpassing 2,200 BTC, explicitly transitioning into a national treasury-type company with BTC as its core reserve.

In addition to the hospitality industry, more diverse businesses are also restructuring their balance sheets with Bitcoin. Food and cultural group DDC (NYSE: DDC), headquartered in the Cayman Islands and operating across China, Hong Kong, and the United States, announced its reacquisition of 230 bitcoins, integrating them into its long-term strategic asset allocation. U.S. medical technology company Semler Scientific, Swedish quantitative trading firm Hilbert Group, and other companies completed Bitcoin acquisitions or secured financing during the same period. Chip and Web3 infrastructure manufacturer Nano Labs, traditional manufacturer Addentax Group based in Shenzhen, travel tech company Webus, and longtime cryptocurrency custody platform Bakkt have also announced or advanced reserve strategies centered around Bitcoin, BNB, XRP, and other digital assets, with amounts ranging from millions to billions of dollars.

These companies, with diverse backgrounds and a wide industry span, have come together under the trend of Bitcoin assetization—viewing digital assets as a key lever for liquidity management, inflation hedging, and capital appreciation. This confirms that the trend of Bitcoin as an "enterprise-grade reserve asset" is accelerating from the tech finance sector to a broader range of real-world economic areas.

The logic behind this is not hard to understand. Against the backdrop of cooling global inflation expectations and the Fed's nearing interest rate hike cycle, some corporate and institutional investors are reevaluating their asset allocation models, once again emphasizing Bitcoin's value. Particularly at a time when traditional safe-haven assets such as gold and long-term U.S. Treasury bonds no longer offer attractive yields, Bitcoin, with high liquidity and a global pricing mechanism, is given more room for imagination beyond its digital gold function.

The current rise in Bitcoin is closely related to the simultaneous strength of the U.S. technology stock sector. AI and semiconductor companies led by NVIDIA are propelling the Nasdaq index to new highs, indirectly reinforcing the market's risk appetite. Yesterday, NVIDIA briefly exceeded a $4 trillion market cap, bringing a strong spillover effect to the stock market. In this context, Bitcoin and tech stocks show a highly positive correlation, further reinforcing their role as risk assets.

Image Source: Golden Finance Data

This linkage is not accidental but rather the result of changes in investor structure. In recent years, traditional stock investors have been migrating to the crypto market, projecting their risk appetite and growth expectations onto Bitcoin through ETFs, futures, and compliant exchanges. Stocks closely related to Bitcoin, such as Coinbase and MicroStrategy (MSTR), have also significantly increased in price recently, indicating that investors are ranking Bitcoin alongside the tech sector as a "future-driven asset."

It is worth noting that policy expectations have also played a key role in managing market expectations. While the likelihood of the U.S. government establishing a "Strategic Bitcoin Reserve" has significantly decreased in the prediction market, the continued discussion of the topic in the public sphere still serves as a psychological cue to investors. With the 2025 "Crypto Week" set to take place in Washington, there is a general expectation in the market that crypto assets will receive more positive guidance within the regulatory framework, especially in areas such as Bitcoin's inclusion in corporate financial statements and state government acquisition plans. The policy's gray area is gradually being clarified.

Furthermore, from on-chain data observation, the Bitcoin market's fund structure is showing a more institutionalized characteristic. According to Coinglass data, around $340 million worth of short positions were liquidated in the Bitcoin market within a short four-hour window around the new all-time high. This phenomenon occurred multiple times during the 2021 bull market, indicating that a large number of high-leverage speculative positions were quickly liquidated in a strong market, leading to a technical short squeeze. Although the price action driven by such leverage liquidations exhibits short-term features, the market signal it releases is very clear: weakening of short positions and establishment of an upward trend.

Meanwhile, although overall liquidity has not fully returned to its peak levels in 2021, on-chain metrics such as MVRV (Market Value to Realized Value Ratio) indicate that the current market is still within a structural uptrend. According to ARK's report, despite a slight cooling of fund flows compared to the early second quarter, long-term capital is still entering the market at a steady pace.

Policy Support Leading to Crypto Week

Not only has the capital market boosted Bitcoin's price, but U.S. policy will also usher in Crypto Week. On July 4, White House Cryptocurrency and AI Czar, "Crypto Tsar" David Sacks, posted that the week of July 14 is House Crypto Week: the "GENIUS Act" will be delivered to the President. The "CLARITY Act" (U.S. Digital Asset Market Regulatory Clarity Act) will also be delivered to the Senate.

From a macro perspective, the strength of the U.S. dollar should have suppressed crypto assets, but Bitcoin has shown significant countercyclical resilience. The Federal Reserve's "Nominal Broad Trade Weighted Dollar Index" has continued to rise, challenging the mainstream logic of "dollar depreciation driving Bitcoin's rise." However, Bitcoin has still seen an upward trend during this period, indicating that its trajectory is gradually moving away from reliance on a single macro factor, displaying a multi-factor intertwined driving characteristic. This trend may imply that Bitcoin is transitioning from a "narrative asset" to a "fundamental asset."

It is worth mentioning that although inflation levels are gradually easing, investors' traditional perception of Bitcoin as an "inflation hedge" is weakening. However, the rebound in risk appetite brought about by expectations of a Federal Funds rate cut has become a driving force for the new round of price increases. In the traditional markets, tech stocks, growth assets, and startup equity have all shown strong performance, and Bitcoin naturally benefits from this trend.

The softness in the real estate market has indirectly driven a preference for capital to move towards liquid assets. ARK pointed out in a report that the current U.S. housing market is experiencing a significant deviation between expectations and transactions, with homeowners' psychological expectations being too high while actual transaction volume continues to decline. The illiquidity under this "price rigidity" has caused some funds that originally allocated to real estate to seek more price-flexible assets. Bitcoin's 24/7 trading and cross-border pricing mechanism have become the preferred destination for such funds.

Overall, the current Bitcoin breakout to a new all-time high is a product of multiple factors intertwined. It has benefited from macro trends such as the surge in tech stocks, loose liquidity, and corporate asset reallocation, while also reflecting Bitcoin's structural advantages of "institutional neutrality, fixed supply, and strong liquidity." In this complex structure, the market trend can no longer be explained by a single narrative framework but requires a comprehensive analysis from multiple dimensions such as fund structure, policy expectations, and investor behavior.

Looking ahead to the future, although there is a short-term risk of price correction, especially in the context of a lack of new buying support after a short squeeze, the market may enter a period of technical consolidation. However, from a medium- to long-term perspective, with trends such as corporate adoption becoming mainstream, gradual clarity in crypto regulation, and a warming sentiment towards risk assets, Bitcoin is still expected to usher in a new uptrend in the second half of 2025, further solidifying its position as a global digital value anchor.

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