Bitcoin: The Asset That Drives Global Markets Is Being Ignored By Bitcoin Investors

Summary I recommend buying Bitcoin due to accelerating institutional adoption, with ETFs and funds now the largest holders and public companies increasing purchases. Bitcoin’s market dominance has surged to 65%, its highest since 2021, as investors favor it over altcoins for digital value storage. The correlation between Bitcoin and US Treasuries has reached a record low, signaling Bitcoin’s emergence as an independent, diversifying asset class. Despite low volatility, Bitcoin is near all-time highs, with promising price forecasts and strong support from institutional flows and market trends. Investment Thesis I recommend buying Bitcoin ( BTC-USD ). Institutional adoption continues to accelerate, as ETFs and funds are the largest institutional holders of the cryptocurrency. Publicly traded companies have also shown significant appetite for Bitcoin in recent quarters. Bitcoin is increasingly relevant in the cryptocurrency market. However, its correlation with treasuries has reached its lowest level on record, demonstrating its decoupling from traditional assets. Meanwhile, price forecasts are promising. Very Close to All-Time High We’re at the beginning of the second half of the year, and one of the most controversial investment theses is undoubtedly Bitcoin. The cryptocurrency is very close to reaching its all-time high , but prices have shown little volatility since the beginning of the year. Analyst’s rating history (The Author) This article is a continuation of my investment thesis published in November 2024, also with a buy recommendation. Next, we’ll analyze the latest Bitcoin data and trends and make some estimates. Institutional Adoption Institutional investors hold about 16% of the total bitcoin supply , or 3.4 million. Of this share, ETFs and funds are the largest holders, with 40.4%, reinforcing institutional appeal following recent regulations. Number of coins by category (Bitcoin Treasuries and CNBC) In my view, the most emblematic example among institutional investors with Bitcoin is BlackRock’s ETFs. You may not have realized it, but the IBIT ETF surpassed the IVV ETF (despite being 9x larger) in fees to the company. The IBIT ETF has $76 billion in assets under management and a 0.25% expense ratio, generating a fee of approximately $190 million per year. The IVV ETF has $626 billion in assets under management and a 0.03% expense ratio, generating a fee of approximately $187.8 million per year. Another sign of progress in institutional adoption comes from publicly traded companies. This is the third consecutive quarter that publicly traded companies have purchased more Bitcoin than ETFs. In the second quarter of 2025 alone, companies purchased 131,000 Bitcoins. Net bitcoin flows for public companies and ETFs (Bitcoin Treasuries and CNBC) But the cryptoasset’s growth isn’t limited to institutional investors. Bitcoin is becoming even more prominent within the cryptocurrency market, and we’ll explore this in more detail below. Representation in the Cryptocurrency Market Despite low volatility in prices this year, Bitcoin once again reached a 65% share of the cryptocurrency market. This is its highest level since January 2021 and a remarkable recovery from the 38% low seen in 2022. Bitcoin Dominance Chart (Creative Planning) This corroborates the thesis that investors are opting for Bitcoin over altcoins . There are other signs that also point to this, and few analysts are addressing them. Independent Asset A great example of this is the chart below. The correlation between Bitcoin’s price and US 10-year Treasury futures over a 60-day window has fallen to its lowest level ever. This means that Bitcoin is increasingly behaving like an independent asset. Correlation Between US 10-year Treasury futures and Bitcoin (Bitwise) This decoupling is a strong indicator of consolidation as an asset class, which can finally promote real diversification in investor portfolios. Bitcoin increasingly reacts to institutional flow and specific market events. Target Price In my last article, I presented a method for estimating the fair price based on Bitcoin’s correlation with the global money supply ( M2 category), which is a measure of the total amount of money in circulation in the world. Global M2 vs. bitcoin lagged 10 weeks (SYZ) The estimate indicates a target price of $125,000, which seems credible and supports the buy recommendation. I remain confident in the recommendation, given the confirmation from Seeking Alpha’s Quant tools, with a strong buy recommendation in IBIT ETF. Quant Rating And ETF Grades (Seeking Alpha) However, my goal is to provide investors with more information, and I’ll share another method for achieving the fair price that caught my attention. This is the Stock-to-Flow model, used to estimate the price of scarce assets. The formula consists of dividing the total quantity of the asset in circulation by the new quantity produced per year. The projections are shown in the chart below. Stock-to-Flow Model (BITBO) The chart shows three major valuation cycles following halvings in 2012, 2016, and 2020. According to this estimate, the fair price after the 2024 halving could reach approximately $250,000 by the end of 2025. Although it is an upside of 127%, the asset’s recent performances show that there is a chance for this performance. Potential Threats To The Bullish Thesis There are several risks to this thesis. The Stock-to-Flow model’s pricing, for example, ignores demand and considers only supply. Furthermore, there is no forecast of economic shocks such as financial crises or regulatory changes. Additionally, after the 2021 cycle, the model did not accurately achieve Bitcoin’s price projections, leading some analysts to question, or even discredit, the model. There are also criticisms of the M2 supply model. The 10-week price shift is arbitrary. Furthermore, the similarity between M2 supply and the Bitcoin price does not prove that one causes the other. The global increase in liquidity could boost several assets, in addition to Bitcoin. The Bottom Line Despite being near its all-time high, Bitcoin’s low volatility has surprised investors in 2025. However, many signs support an optimistic outlook for the crypto asset going forward. Institutional adoption is accelerating, and in addition to ETF managers, publicly traded companies are buying Bitcoin like never before. The decorrelation with US Treasuries indicates that the asset is becoming an independent asset. Based on this analysis, I recommend buying Bitcoin. As an independent asset, Bitcoin can finally play a diversifying role in investors’ portfolios, and the upside based on the metrics shown is very attractive.

Source: Seeking Alpha