Bitcoin may sustain momentum in 2025 despite Google's quantum chip concerns
euronews.comBitcoin's price topped the $100,000 (€95,268) mark this month following Trump's nomination of the pro-crypto Paul Atkins to be the new leader of the US Securities and Exchange (SEC).
The world's largest digital token hit highs of more than $103,000 (€98,126) on 5 December before retreating to under $96,000 (€ 91,457) in the early session on Wednesday.
The sharp price decline in Bitcoin was triggered by Google’s announcement of its quantum computing chip, Willow, on 9 December.
The super-powered chip is considered to have the potential to break cryptographic algorithms, raising concerns about cryptocurrency security.
However, industrial experts said that quantum technology would take years and billions of dollars to achieve such an ability. Meanwhile, Google’s parent Alphabet saw its shares surging 5% on Tuesday.
Despite the recent drop, some analysts believe Bitcoin will continue its bullish trend. Christoper Lewis, FXEmpire’s analyst, believes the pullback offers value each time it dips.
He mentioned that the Fed’s rate decisions and the US inflationary trajectory remain critical influential factors on the crypto markets.
Fed Chair Jerome Powell said that Bitcoin is like gold but only virtual, reinforcing its positive correlation with the precious metal.
Similar to gold, historically, Bitcoin trended up during a rate-cut cycle and went through a downturn when central banks, particularly the Fed, started tightening monetary policy.
This suggests that cryptocurrencies’ trends reflect market liquidity conditions. Hence, Bitcoin may benefit further from the macro tailwind in the new year.
Major central banks are widely expected to continue their easing cycle amid cooling inflation and slowing down economic growth.
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