VanEck Issues Warning: Bitcoin May See 30% Dip Before Reaching $180K

Matthew Sigel, head of digital asset research at VanEck, has outlined an ambitious forecast for the cryptocurrency market through 2025, with a strong focus on Bitcoin. Sigel expects Bitcoin to surge to $180,000 in the first quarter of 2025, driven by institutional adoption and a favorable regulatory environment. However, he warns that this initial peak will likely be followed by a market correction, with Bitcoin pulling back by 30%. He predicts that altcoins, including Ethereum, Solana, and Sui, will also see significant gains initially but could experience deeper declines of up to 60% during the summer months of 2025.

Sigel highlights several key indicators that investors should monitor to spot potential market tops. One of these indicators is sustained high funding rates, which signal excessive speculation in the market. When traders consistently pay funding rates above 10% for three months or longer, it typically suggests that the market may be overheating. Additionally, unrealized profits among Bitcoin holders are a critical metric; when a large proportion of holders are in profit, with a profit-to-cost ratio exceeding 70%, it often signals market euphoria and potential overvaluation. Bitcoin’s market dominance is another crucial signal, with a drop below 40% potentially indicating excessive speculation in altcoins, characteristic of late-stage market behavior.

The analysis also links current market momentum to political factors, specifically the anticipated election victory of Donald Trump and his crypto-friendly leadership team, including potential appointees such as JD Vance as Vice President and Paul Atkins as the SEC Chair. Sigel suggests that this shift towards a more crypto-friendly environment could drive further growth for Bitcoin, positioning it as a strategic asset.

Sigel’s forecast includes a market correction in the summer of 2025, but he believes a recovery will take place in the fall, with major cryptocurrencies likely reclaiming their all-time highs by the end of the year. This recovery is expected to be supported by continued institutional adoption and favorable regulatory developments under the new administration.

In conclusion, while Sigel projects a major price surge for Bitcoin in the early part of 2025, he warns investors to watch for warning signs of excessive speculation and to brace for a market correction. Ultimately, he expects a strong recovery and renewed growth in the latter part of the year, assuming continued institutional interest and supportive political and regulatory changes.