Institutional Investment Strategies & Regulatory Clarity Driving Crypto Bull Run
Cryptocurrency prices can be found on Binance . Take a look at price performance over the past year, and one can see that, while Bitcoin is up by 71.9% over the past twelve months, Ethereum has fallen by around 26.3% . Other major Altcoins, like BNB, Binance's native token have gained since last year, but these gains have trailed that of BTC.
This is not surprising. A key driver of this latest crypto bull run has been institutional adoption of Bitcoin. First, in early 2024, the SEC approved the launch of spot Bitcoin ETFs. With a compliance-friendly vehicle for crypto ownership coming online, institutional investors cycled significant capital into these funds. By year's end, the value of all U.S.-listed spot Bitcoin ETFs totaled $104.1 billion , with $27.4 billion of this figure representing investment from institutions with assets under management exceeding $100 million.
Then, the election of Donald Trump to a second term as U.S. President spurred another bullish wave, as market participants anticipated his new administration would fast-track regulatory clarity in the United States. So far, confidence in U.S. regulatory clarity has increased, as policymakers on both sides of the aisle finalize a clear and comprehensive crypto regulatory framework .
Now, as the latest bull wave calms down, the questions now are whether a new bull wave will emerge, when regulatory clarity becomes reality, and whether major Altcoins, not just Bitcoin, will benefit in terms of price appreciation. For further insight into these questions, let's take a look at a recent interview with a crypto industry leader. 2024-2025 Crypto Bull Run: Driven by Institutional Allocation to Bitcoin
Back in 2017, the cryptocurrency bull run was driven in large part by speculation in initial coin offerings (ICOs). During the 2021 bull run, a major factor at play was the rapid rise in popularity of non-fungible tokens (NFTs).
The 2024-2025 crypto bull run, however, has been differentiated by both its outsized focus on Bitcoin, and the outsized participation of institutional investors rather than crypto whales and a critical mass of retail traders.
Earlier this month, Catherine Chen, Head of VIP and Institutional at Binance, sat down with Behind Binance host Jessica Walker, to discuss the dynamics of the latest crypto bull run , and what it means for crypto prices moving forward. According to Chen, institutional interest in crypto has been steadily growing, with last year's debut of spot cryptocurrency ETFs serving as a "pivotal moment" for institutional adoption. As Chen explained, "at the very minimum all of these institutional investor(s) has a fiduciary duty to at least take a proper look at this asset class and thanks to the introduction of ETF this asset class has also been given the much needed legitimacy."
That said, Chen also argues that different types of institutional investors are moving into crypto at differing paces, with larger, more conservative institutional investors still largely sitting on the sidelines. Per Chen, "regulatory clarity" remains the key hurdle. Certain institutional investors, like insurance companies and pension funds, need well-refined regulations in order to move forward with direct crypto investments. What This Means for Bitcoin and Altcoin Prices
Although the aforementioned interview focused primarily on institutional adoption, one can infer from this interview what recent institutional adoption trends could mean for both Bitcoin and Altcoin prices moving forward.
Based on Chen's insights on regulatory clarity, it's clear that, once the U.S. and other major jurisdictions finalize and implement their cryptocurrency regulatory regimes, this could spur an even greater inflow of capital into this asset class. At first, as seen recently, this may simply mean a further bull run in which Bitcoin continues to experience outsized price appreciation relative to major Altcoins like ETH and BNB.
However, in time, this could translate into a more significant bull run for Altcoins as well. Once institutional investors complete their initial allocation to Bitcoin, allocation to ETH and other major Altcoins could pick up as well, especially as new spot Altcoin ETFs make it to market.
In short, given the large role institutional investors have played in this latest bull run, it is not surprising that the situation has played out far differently than the above-mentioned 2017 and 2021 bull runs. The Takeaway for Retail Investors
With Bitcoin price plateauing, after extended rallies from October 2024 to January 2025, then from April 2025 through May 2025, it may at first seem like this latest bull run is coming to an end.
However, per another crypto market expert, HashKey Capital's Xu Han, "the crypto cycle is still in a growth phase." Furthermore, per Han, there is another potential catalyst that could extend the current bull run. That would be the anticipated shift from hawkish to dovish monetary policy by the U.S. Federal Reserve.
In other words, if the Feds continue to lower rates, as well as complete its wind-down of institutional tightening, the resultant liquidity boost could be a boon for crypto prices, given historical trends. Retail investors should keep all of this mind, when deciding whether to go bullish or bearish in the current market environment.
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