Weekly Forecasts 29/2025

Bullish in a bearish environment

In this Weekly Forecast, we focus on the state of the crypto market and the surrounding macro environment.

Macro and price movement

July proved to be a pivotal month for crypto markets. Bitcoin soared to record levels, closing the month above $116K , which marks a significant breakout well past its previous cycle high (~$69K in late 2021). Traders see this as confirmation of a post-halving bullish cycle underway. Profit-taking did emerge as BTC briefly slipped back to ~$114K this weekend , but the overall uptrend remains intact. Bitcoin is still up roughly 15% in 2025 so far , and year-on-year gains are even more impressive. We can see robust support from long-term holders and corporate buyers, which has reduced sell pressure. Notably, MicroStrategy (rebranded as “Strategy”) added 21,000+ BTC in Q2 and now holds nearly 600,000 BTC (~3% of the total supply) on its balance sheet, a powerful vote of confidence in BTC’s long-term value proposition.

Ethereum, the second-largest crypto, came roaring back into focus with an eye-popping 48% price jump in July . ETH ended last month near $3.7K, levels unseen since late 2024, before easing to about $3.5K now. While still below its all-time high (~$4.8K in Nov 2021), Ethereum’s recent surge has significantly narrowed the gap. The rally was fueled by a confluence of factors: risk-on sentiment in tech and crypto, Ethereum’s integral role in decentralized finance (DeFi), and critically, new Ether spot ETFs launching to heavy demand. In fact, July saw U.S. Ether ETFs attract over $5 billion in net inflows, intensifying buying pressure on ETH . This institutional bid helped Ethereum outperform Bitcoin in July (48% vs 7.9% gains) – a reversal of the year’s earlier trend where BTC had led the market. On-chain data also underscores Ethereum’s strength: daily active addresses spiked to 841,000+ (a 1-year high) in late July, reflecting surging network usage . Additionally, large players have been accumulating Ether; one tracker noted tens of thousands of ETH added to institutional wallets in just days . All of this suggests that despite lagging Bitcoin at times, Ethereum is far from “losing its narrative.” Its successful shift to proof-of-stake and upcoming upgrades (for scalability and data sharding) continue to attract investors who see ETH as both a technology platform and a yield-generating asset via staking. As David Lawant of FalconX put it, certain altcoins like ETH with “strong and distinct use cases” still have room to shine, especially if regulatory shifts permit more DeFi innovation on public networks.

The macro backdrop in mid-2025 is a study in contrasts, but overall increasingly favorable for crypto risk assets. On one hand, inflation that spiked globally in 2022–23 has largely been tamed. Global inflation is expected to decline further in 2025, according to the IMF, though U.S. inflation still remains well above the Fed’s 2% target. Price pressures easing has allowed central banks to step off the brakes. The Federal Reserve, after an aggressive rate hike campaign, paused rate increases in early summer. Now, with economic data showing sharply slowing job growth (just 73K jobs added in July) and unemployment inching up, markets are betting the Fed’s next move will be a rate cut as soon as the September FOMC meeting . Fed officials themselves acknowledge that policy may have finally turned the corner: “The latest jobs numbers put more pressure on the Fed to cut interest rates,” one regional Fed president remarked, noting signs of a broadly weakening labor market and economy . Indeed, Fed fund futures now price in an 82% chance of a rate cut by September – a dramatic shift toward monetary easing. This growing expectation of liquidity relief has bolstered risk sentiment across the board. U.S. equities have been climbing (the S&P 500 is up ~7% YTD ), credit spreads tightening, and Bitcoin has benefited from the prospect of lower real rates ahead.