Review of the First Half of 2025: The crypto market demonstrates resilience, and a new engine may emerge in the second half.

In the first half of 2025, the global financial market experienced turbulence. Despite the delayed expectations of interest rate cuts in the United States and escalating geopolitical tensions, Bitcoin and the entire crypto market demonstrated a strong rebound capability, showcasing its potential as an emerging asset class. As the second half approaches, some key development trends are brewing in the market.

The US economy is showing signs of a "soft landing," with the job market remaining relatively stable. In May, there were 139,000 new non-farm jobs, and the unemployment rate was 4.2%, with wages growing by 3.9% year-on-year. These figures indicate that while there is a slight slowdown in the labor market, it remains in a healthy state. At the same time, inflationary pressures have eased, with the core CPI growing by 2.7% year-on-year in June, a slight decrease from the previous period.

However, the risks of slowing economic growth and persistent inflationary pressures are increasing. Some analytical institutions have downgraded the forecast for US GDP growth in 2025 from 2% to 1.3%, warning that tariff policies may push prices higher and suppress economic growth, leading the economy into a "stagflation" dilemma. There are internal divisions within the Federal Reserve regarding the timing of interest rate cuts, reflecting the contradiction between inflation and economic growth.

The impact of tariff policies on prices may gradually become apparent in the coming months. Companies have alleviated short-term shocks by stockpiling in advance, but as inventory is consumed, rising import costs may gradually be passed on to end prices. If inflation rebounds, the Federal Reserve may be forced to delay interest rate cuts or even pause easing policies, exacerbating market concerns about stagflation.

Looking ahead to the second half of 2025, there remains a high level of uncertainty regarding the Federal Reserve's policy direction. The employment and inflation data from July will serve as a key decision-making basis. If the data shows that inflationary pressures are under control, there is a higher likelihood of a rate cut in September; however, if inflation rises above expectations, the market may face the impact of policy tightening.

Despite weak economic data, the U.S. stock market still shows a volatile upward trend driven by expectations of interest rate cuts, breakthroughs in stablecoin regulation, and rebounds in tech stocks. In June, the S&P 500 index rose by 4.96%, and the Nasdaq index increased by 5.93%, repeatedly reaching historical highs.

Cryptocurrency-related stocks have performed particularly well. A well-known stablecoin company saw its stock price soar over 600% after going public on the New York Stock Exchange on June 5, becoming one of the most notable fintech IPOs of 2025. The stock of another major cryptocurrency exchange also rose by 43% that month.

Behind this surge is the first federal regulatory bill on stablecoins passed by the U.S. Senate. The bill establishes a regulatory framework for stablecoins, requiring issuing institutions to hold reserves in a 1:1 ratio with the dollar or short-term U.S. Treasury securities, and prohibits algorithmic stablecoins and interest-bearing stablecoins. This regulatory progress reflects the strong market expectations for "compliance dividends."

It is worth noting that in the first half of 2025, the decline of Bitcoin has narrowed and volatility has decreased, indicating that the maturity of the crypto market has improved with the entry of institutional investors. Companies are increasing their holdings of Bitcoin through convertible bond financing, incorporating digital assets into their balance sheets, forming a new capital operation model of "issuing shares to purchase coins." This trend not only supports the price of Bitcoin (which rose 10.6% in the first half of the year) but also enhances the legitimacy and market recognition of crypto assets.

Looking ahead to the second half of the year, if the stablecoin regulatory bill is passed in the House of Representatives and signed into law, it will officially usher in a new era of stablecoin regulation. This could accelerate the inflow of institutional funds, further blur the lines between the traditional stock market and the crypto market, and strengthen the "coin-stock linkage" effect.

In June, Bitcoin demonstrated resilience amidst a complex situation. Although geopolitical conflicts once caused the price to drop below $100,000, it quickly rebounded, showing a trend of gradually decoupling from traditional risk assets. Institutional investors are continuously increasing their holdings through channels such as ETFs, reshaping market structure and volatility characteristics.

In the first half of 2025, the crypto market may be experiencing the most profound paradigm shift since its inception. Its development trajectory is no longer solely determined by market sentiment or technical indicators, but is showing new vitality under the joint influence of technology, capital, regulation, and ecosystem.

The trend of institutionalization reached new heights in June, with the global crypto market ETF size surpassing $1.1 trillion. The participation of traditional financial institutions has also undergone a qualitative change, for example, a large investment bank has started offering Bitcoin collateralized loan services. At the same time, the shift in the Federal Reserve's monetary policy is expected to inject new variables into the market.

In terms of regulation, major financial centers such as the United States and Hong Kong have established a preliminary compliance framework for digital assets, and this policy certainty is attracting more traditional capital to enter the market. In addition, there are reports that the U.S. government is considering building strategic Bitcoin reserve infrastructure, potentially increasing its Bitcoin holdings in a budget-neutral manner.

Overall, the crypto market in mid-2025 has fundamentally differentiated itself from the earlier phase driven purely by speculation. Bitcoin is becoming an important tool for global capital allocation, reflecting broader macroeconomic trends.

Looking ahead to the second half of 2025, with the possible interest rate cuts from the Federal Reserve, continued growth in corporate encryption adoption, and the clarification of regulatory policies, the crypto market is expected to enter a new phase of steady development. Currently, the price of Bitcoin remains in the high range of $100,000 to $120,000, and future trends are worth looking forward to.