bitcoin Surges to New Heights Amid Pro-Crypto Legislation

By Lyle Daly | The Motley Fool

bitcoin has once again reached a remarkable milestone, surpassing $115,000 on July 10, just two months after hitting its previous all-time high. This surge marks a 25% increase in 2025 alone and an astonishing 1,150% growth over the past five years.

Given bitcoin‘s notorious volatility, forecasting its future price movements remains a challenge. However, several factors suggest that it could continue to climb in the latter half of the year.

A Favorable Political Climate for Cryptocurrency

The current political environment under the Trump administration has been advantageous for the cryptocurrency sector. Paul Atkins, the newly appointed Chair of the Securities and Exchange Commission (SEC), advocates for innovation in the marketplace. His leadership has led to the dismissal of several lawsuits against major crypto platforms like Coinbase, Binance, and Ripple.

In March 2025, President Trump initiated the U.S. Strategic bitcoin Reserve, a government-owned stockpile of bitcoin. Additionally, states like Arizona and New Hampshire have enacted legislation to establish their own bitcoin reserves.

As we move into the second half of the year, the potential passage of the Genius Act—a bill aimed at regulating the stablecoin industry—could further legitimize the crypto market. The Senate approved the bill on June 17, and a House vote is forthcoming. While the Genius Act doesn’t directly pertain to bitcoin, any significant regulatory framework could enhance the industry’s credibility and attract more investors.

Growing Interest in bitcoin ETFs

The approval of bitcoin exchange-traded funds (ETFs) in January 2024 has made this cryptocurrency more accessible to both institutional and retail investors. Since April, bitcoin ETFs have experienced a surge in investments, with net inflows exceeding $50 billion as of July 10, according to Farside Investors.

Despite fluctuations in ETF inflows and outflows, bitcoin‘s strong performance is likely to maintain investor interest. Standard Chartered, a British bank, has projected that bitcoin could reach $200,000 by year-end, with ETF inflows playing a crucial role in this growth.

The Impact of Lower Interest Rates

Interest rates significantly influence various markets, including stocks, bonds, and cryptocurrencies. A reduction in borrowing costs typically encourages investment. Historically, low-interest-rate environments have coincided with bitcoin bull runs, particularly in 2020 and 2021. Additionally, lower rates can lead to inflation, prompting investors to turn to bitcoin as a hedge.

Analysts anticipate that the Federal Reserve will cut rates in the latter half of this year. Current market expectations suggest a 68% chance of a rate cut in September, with Goldman Sachs forecasting reductions of 25 basis points in September, October, and December. Such rate cuts could provide a favorable backdrop for bitcoin.

The Declining Value of the U.S. Dollar

The strength of the U.S. dollar also plays a crucial role in bitcoin‘s price dynamics. Typically, bitcoin and the dollar exhibit an inverse relationship; as the dollar weakens, bitcoin tends to rise, as it is viewed as a more reliable store of value.

The U.S. Dollar Index (DXY) has already fallen by 10% this year, largely due to economic uncertainties stemming from the Trump administration’s import tariffs. Should the Federal Reserve opt for interest rate cuts, the dollar may weaken further. While a rebound in the dollar is hoped for, the likelihood of continued decline could benefit bitcoin.

Rise of bitcoin Treasury Companies

A notable trend in the cryptocurrency landscape is the emergence of bitcoin treasury companies. These firms leverage debt or equity to acquire bitcoin, which they hold on their balance sheets. MicroStrategy is a prominent example, holding over 597,000 bitcoin, while 125 public companies reported bitcoin holdings in the second quarter of 2025.

These companies collectively purchased a record 159,107 bitcoin, marking a 23% increase from the previous quarter. Given bitcoin‘s impressive growth, it is likely that more businesses will consider investing in it.

Despite bitcoin‘s recent achievements and the potential positive influences in the latter half of 2025, it remains a high-risk asset. As history has shown, prices can drop unexpectedly. For those considering an investment in bitcoin, it is advisable to limit exposure to a small portion of one’s portfolio and be prepared for market fluctuations.

Lyle Daly holds positions in bitcoin. The Motley Fool has positions in and recommends bitcoin and XRP, as well as Coinbase Global and Standard Chartered Plc. For more information, please refer to The Motley Fool’s disclosure policy.

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