What Makes Crypto Go Up?
Introduction
The cryptocurrency market is volatile in 2025, with Trump’s tariff policy having a profound impact on the crypto market, prompting investors to reassess their strategies. This article analyzes in-depth the factors influencing the rise and fall of cryptocurrencies, discusses the reasons for the rise and fall of the cryptocurrency market in 2025, and provides investors with practical cryptocurrency investment strategies.
Key factors affecting the rise and fall of the crypto asset market in 2025
In 2025, the crypto asset market presents a complex and ever-changing situation. At the beginning of the year, Bitcoin continued its strong upward trend from 2024, and market sentiment was generally optimistic. However, the new tariff policy introduced by the Trump administration in early April brought a huge impact to the market, leading to significant fluctuations in crypto asset prices. Throughout the year, the rise and fall of the crypto asset market were influenced by multiple factors, including macroeconomic policies, changes in regulatory environment, and attitudes of institutional investors.
Specifically, Bitcoin price Reaching a historical high of $106,140 in early 2025, but after the Trump administration announced new trade tariff policies in early April, the price quickly fell to around $80,592, a drop of over 24%. As of April 11th, the price of Bitcoin fluctuated around $80,550, with a crypto asset market capitalization of $2.65 trillion, a decrease of 3.5% in the past 24 hours. Nevertheless, Bitcoin has still maintained a nearly double increase compared to the price of $44,000 in early 2024, demonstrating the resilience of the crypto asset market.
In addition to policy factors, the participation of institutional investors is also an important factor affecting the crypto assets market in 2025. According to Gate.io’s data, as of April 2025, the assets under management of Bitcoin ETFs have exceeded $24 billion, with BlackRock and Fidelity holding $15 billion and $9 billion in Bitcoin assets, respectively. This indicates that institutional investors’ interest in crypto assets continues to grow, providing important liquidity support to the market.
In addition, the actual application scenarios of Crypto Assets continue to expand, which is an important factor driving the rise in prices. The Total Value Locked (TVL) of decentralized finance (DeFi) projects on the Ethereum network surpassed the $100 billion mark in the first quarter of 2025, an increase of 150% compared to the same period in 2024. This indicates that the Crypto Assets eco is gradually maturing, providing users with more practical financial services.
| factor | 2024 year | 2025 | growth rate |
|---|---|---|---|
| Institutional Bitcoin holdings ratio | 15% | 20% | 33.33% |
| Total Locked Value of DeFi | 400 billion dollars | $XX billion | 150% |
Finally, the changes in the macroeconomic environment have also brought good news to the Crypto Assets market. The continued inflationary pressure in major global economies has prompted investors to seek hedging tools. Bitcoin’s positioning as the ‘digital gold’ has been further strengthened, attracting a large influx of safe-haven funds.
Bitcoin ETF and halving events drive the rise of the cryptocurrency market
The Bitcoin ETF and halving events are two key factors affecting the crypto asset market. The approval and listing of the Bitcoin ETF have provided a convenient channel for traditional investors to enter the crypto asset market, leading to a large-scale inflow of institutional funds. According to Gate.io’s statistics, since the approval of the Bitcoin spot ETF in January 2024, the amount of Bitcoin held by the ETF has exceeded 600,000 coins, accounting for about 3% of the total circulation. This not only increases the liquidity of Bitcoin, but also enhances market confidence.
The halving event of Bitcoin is another important market driver. The halving event in April 2024 will reduce the new supply of Bitcoin from 6.25 bitcoins every 10 minutes to 3.125 bitcoins. Historical data shows that halving events usually trigger a rise in Bitcoin prices. In the 6 months after the 2024 halving, the price of Bitcoin rose by 83%, a similar increase to the performance after the halvings in 2016 and 2020. The halving event creates a supply-demand imbalance by reducing the new supply, thereby driving the price up.
| Halving Year | 6-month increase after halving |
|---|---|
| 2016 | 51% |
| 2020 | 83% |
| 2024 | 83% |
Blockchain technology development pushes the rise of the cryptocurrency market
The rapid development of blockchain technology has had a profound impact on the crypto asset market. First, the breakthrough progress in scalability has greatly improved the transaction processing capabilities of mainstream public chains. After the comprehensive upgrade of Ethereum 2.0, the transaction processing volume (TPS) has increased from the previous 15-30 transactions per second to over 100,000 transactions per second, which has not only significantly reduced network congestion issues, but also made Ethereum more suitable for large-scale commercial applications.
At the same time, the maturity of cross-chain technology has provided convenience for the interoperability of assets between different blockchain networks. Cross-chain projects such as Polkadot and Cosmos have achieved important milestones in 2025, making the value transmission between different public chains more efficient and secure. This progress not only enhances the interoperability of the entire crypto asset eco, but also provides a broader space for the development of decentralized applications (DApps).
In addition, the widespread application of second-layer scaling solutions such as Zero-Knowledge Proofs (ZK-Rollups) has greatly enhanced the privacy protection capabilities and transaction efficiency of blockchain networks. As of March 2025, ZK-Rollups on the Ethereum network process over 5 million transactions daily, accounting for over 40% of the total transaction volume. This not only attracts more privacy-conscious users and enterprises to join the blockchain eco but also paves the way for daily payment applications of Crypto Assets.
Finally, the continuous optimization and innovation of smart contract technology have also brought new vitality to the crypto asset market. The extensive application of upgradeable smart contracts enables blockchain projects to more flexibly carry out functional updates and vulnerability fixes, greatly reducing security risks. At the same time, the emergence of cross-chain smart contracts has brought more possibilities to decentralized finance (DeFi), non-fungible tokens (NFT), and other fields, stimulating innovation and growth in the entire market.
As a leading crypto asset trading platform, Gate.io actively embraces these technological innovations to provide users with a safer and more efficient trading experience. By supporting multi-chain assets and cross-chain transactions, Gate.io not only expands users’ investment choices, but also contributes to the further development of blockchain technology.
Conclusion
The cryptocurrency market saw significant growth in 2025, driven by a substantial increase in institutional investment, clarification of regulatory environment, and breakthrough progress in blockchain technology. The improvement in market maturity and liquidity has laid a foundation for long-term development, but investors still need to closely monitor the opportunities and challenges brought about by policy changes and technological innovations.
Risk Warning: The market still has high volatility, regulatory policy changes may bring uncertainty, investors should carefully assess the risks.
