On May 8, 2025, Bitcoin reached a significant milestone, surpassing the $100,000 mark for the third time in its history, with peak values around $105,000. This growth, recorded on leading trading platforms like Binance, highlights the cryptocurrency's resilience and its growing appeal amid the changing market landscape. The rally was supported by significant interest from institutional investors, evidenced by a net inflow of $142.3 million into spot Bitcoin ETFs on May 7, according to Farside Investors data.
For the first time, Bitcoin became a deflationary asset, showing an annual inflation rate of -2.33%. This unprecedented shift is driven by corporate buyers like Strategy, who are purchasing Bitcoins faster than miners can produce them. The fixed supply limit of 21 million coins, combined with increased demand, has created a scarcity effect, reducing the volume of circulating coins and intensifying deflationary pressure. This transition makes Bitcoin a unique asset, comparable to digital gold, which may significantly impact its long-term value.
The current growth underscores the increasing role of institutional investors in the cryptocurrency market. Corporate entities are increasingly considering Bitcoin as a hedge against economic uncertainty, supported by a more favorable regulatory environment under the Trump administration. Recent policy initiatives indicate a move towards integrating digital assets into the US financial system, further encouraging institutional participation. However, the influx of capital raises concerns about market concentration and potential volatility.
Despite Bitcoin's breakthrough, which is a bullish signal, analysts remain cautious. The cryptocurrency's volatility was evident earlier this year when a sharp correction followed a peak above $100,000 in January. Macroeconomic factors, such as US Federal Reserve policy and global trade tensions, continue to influence market sentiment. Expert opinions are divided: some forecast growth to $155,000 based on scarcity dynamics similar to gold, while others warn of a possible pullback if macroeconomic risks intensify.
Bitcoin's surpassing the $100,000 mark and its transformation into a deflationary asset signal a pivotal moment for the cryptocurrency market. Institutional adoption and favorable policies drive growth, but investors should consider the risks associated with volatility and global economic shifts. As Bitcoin strengthens its status as a store of value, its trajectory is likely to shape the further development of the cryptocurrency landscape in the coming months.