rewrite this title Why might this bull run behave differently?

Bitcoin bull runs are legendary for their volatility, with dramatic price surges often followed by severe sell-offs of 50%, 60%, or even 80%. However, the dynamics of this cycle suggest it might be unlike the ones we’ve seen before. Here are six reasons why this bull run could contribute to greater price stability and reduce the likelihood of the massive sellouts of the past.

1. Institutional Adoption: ETFs and Pension Funds

How It Contributes to Price Stability: The introduction of Bitcoin ETFs has simplified access for institutional investors, encouraging long-term holding rather than speculative trading. Over the coming months, pension funds—known for their large-scale, long-term investments—may begin allocating capital to Bitcoin ETFs. These funds tend to buy and hold assets for extended periods, effectively locking up significant portions of Bitcoin supply.

Impact on Big Sellouts: In past bull runs, sharp sell-offs often occurred due to retail traders and speculators exiting en masse. Institutional participation, particularly from pension funds, could dampen these rapid sell-offs by providing a consistent base of long-term holders.

2. Pro-Crypto Policies and Potential U.S. Bitcoin Federal Reserve

How It Contributes to Price Stability: Pro-crypto legislation and initiatives like El Salvador’s adoption of Bitcoin as legal tender have legitimized Bitcoin on a global scale. If Donald Trump’s speculative proposal for a U.S. Bitcoin Federal Reserve comes to fruition, it could establish the U.S. as a significant Bitcoin holder. This would encourage other nations to follow suit, potentially holding Bitcoin as a strategic reserve asset.

Impact on Big Sellouts: Government adoption could absorb substantial amounts of Bitcoin supply and reduce market availability. This might lead to steadier price increases over time, as large sell-offs would have less of an impact when significant portions of Bitcoin are held by sovereign entities.

3. Limited Supply: A Tight Market

How It Contributes to Price Stability: Bitcoin’s finite supply is a fundamental aspect of its value proposition. This cycle, the market has absorbed significant liquidation events—such as Mt. Gox distributions and government auctions—without major price collapses. With fewer significant sellers remaining, upward price momentum might face less resistance.

Impact on Big Sellouts: In prior cycles, large-scale sell-offs were exacerbated by sudden increases in supply. With the major selling pressures already absorbed and no substantial sellers on the horizon, the likelihood of sharp price declines is significantly reduced.

4. Maturing Asset Class

How It Contributes to Price Stability: Bitcoin has evolved from a speculative asset to a recognized store of value and hedge against inflation. Banks like JP Morgan and BlackRock are integrating Bitcoin into their services, while technological advancements such as the Lightning Network and Taproot upgrade enhance its usability.

Impact on Big Sellouts:The growing perception of Bitcoin as a stable, reliable asset could encourage long-term holding among both retail and institutional investors. This shift reduces the likelihood of panic selling during market corrections.

5. Environmental and Sustainability Improvements

How It Contributes to Price Stability:Rising use of renewable energy in Bitcoin mining and innovations like stranded energy utilization are reshaping Bitcoin’s environmental narrative. These developments attract ESG-conscious investors who prioritize sustainable assets for long-term portfolios.

Impact on Big Sellouts:As more environmentally conscious investors enter the market, Bitcoin’s base of holders becomes more diverse and resilient. This mitigates the impact of speculative sell-offs, as long-term investors are less likely to liquidate during market downturns.

6. Global and Cultural Tailwinds

How It Contributes to Price Stability:Bitcoin adoption is growing globally, particularly in emerging markets where it is used as an alternative to unstable fiat currencies. Additionally, younger generations—more inclined toward digital assets—are embracing Bitcoin as part of their financial strategy.

Impact on Big Sellouts:With increasing adoption across diverse geographies and demographics, Bitcoin’s market becomes more distributed and less prone to localized sell-offs. This broader base of holders strengthens overall market stability.

Summary

This Bitcoin bull run is underpinned by transformative changes: institutional adoption, pro-crypto policies, constrained supply, and a maturing narrative are laying the groundwork for sustained growth. While the market remains unpredictable, these factors collectively reduce the likelihood of sharp sell-offs that have defined past cycles.

The evolving Bitcoin ecosystem, bolstered by long-term institutional participation and global acceptance, could make this bull run one to remember—not for its volatility, but for its resilience and steady ascent. Time will tell, but the signs point to a new era for Bitcoin.

UK Disclaimer: Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 mins to learn more

This communication is for information and education purposes only and should not be taken as investment advice, a personal recommendation, or an offer of, or solicitation to buy or sell, any financial instruments. This material has been prepared without taking into account any particular recipient’s investment objectives or financial situation, and has not been prepared in accordance with the legal and regulatory requirements to promote independent research. Any references to past or future performance of a financial instrument, index or a packaged investment product are not, and should not be taken as, a reliable indicator of future results. eToro makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication.

ASIC disclaimer: eToro AUS Capital Limited ACN 612 791 803 AFSL 491139. Crypto assets are unregulated and highly speculative. There is no consumer protection. You risk losing all of your capital. Refer to our Terms and Conditions. See full disclaimer

ADGM disclaimer: Cryptoassets are complex and carry a high risk of volatility and loss. Trading or investing in cryptoassets may not be suitable for all investors. Please refer to T&Cs.

Past performance is not an indication of future results

This communication is for information and education purposes only and should not be taken as investment advice, a personal recommendation, or an offer of, or solicitation to buy or sell, any financial instruments. This material has been prepared without taking into account any particular recipient’s investment objectives or financial situation, and has not been prepared in accordance with the legal and regulatory requirements to promote independent research. Any references to past or future performance of a financial instrument, index or a packaged investment product are not, and should not be taken as, a reliable indicator of future results. eToro makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication.

FSA Disclaimer: Crypto assets are unregulated and highly speculative. There is no consumer protection. You risk losing all of your capital. 

FR: Cryptoassets investing and custody are offered by eToro (Europe) Ltd as a digital asset service provider, registered with the AMF. Cryptoasset investing is highly volatile. No consumer protection. Tax on profits may apply.

DE: Cryptoasset investing is highly volatile and unregulated in some EU countries. The service offered is provided by DLT Finance, a brand of DLT Securities GmbH, which has outsourced the provision of services or parts thereof to eToro (Europe) Ltd. and incorporated in Cyprus into its own service provision. All activities requiring regulatory authorization, especially financial commission business and proprietary trading, including the execution of orders on suitable trading venues or against DLT Securities GmbH itself, such as in market making, are provided by DLT Securities GmbH. DLT Securities GmbH is a German investment firm according to §2 (1) WpIG and is supervised as such by the Federal Financial Supervisory Authority (BaFin). Tax on profits may apply.

ES: Investments in crypto-assets are not regulated. They may not be appropriate for retail investors and the full amount invested may be lost. It is important to read and understand the risks of this investment, which are explained in detail at this link.

Rest of EU: Cryptoasset investing is highly volatile and unregulated in some EU countries. Tax on profits may apply.