Stablecoin Expansion, Interest Rate Cycle, and Reassessing the Four-Year Cycle: Seokmoon Jeong’s 2025 Bitcoin Scenario

From the correlation between Bitcoin prices and stablecoin market capitalization to rate-cut expectations and liquidity, the positioning of gold versus Bitcoin, and even the validity of the four-year cycle hypothesis, Seokmoon Jeong, Head of the Presto Research Center, offers clear perspectives on the questions crypto investors ask most. In brief, stablecoin growth is closer to an outcome than a cause, the interest-rate and liquidity backdrop is turning constructive, and overconfidence in the four-year cycle should be avoided. He estimates Bitcoin’s fair value in 2025 at roughly $160,000, emphasizing macro factors and capital inflow pathways over attempts to call a short-term bottom.

Stablecoin Market Cap and Bitcoin: Correlated, But Causality Differs

The current stablecoin market capitalization is presented at around $450 billion, and on the surface it appears to move in tandem with Bitcoin. Jeong underscores the need to distinguish correlation from causation. In his view, it is often more accurate to say that Bitcoin’s rise drives demand and issuance of stablecoins, rather than stablecoin issuance lifting Bitcoin. The prevailing interest-rate regime is the key variable. When market rates are high, there is less incentive to seek yield in crypto, and stablecoin balances have tended to contract. The sharp drawdown in stablecoin supply during the 2021–2022 rate-hiking phase supports this. Conversely, as rates decline, liquidity within crypto can expand and stablecoin issuance can reaccelerate. He sees a high probability of rate cuts next year, which should mitigate this risk and support market liquidity.

Gold at All-Time Highs: Why Does Bitcoin Look Relatively Soft?

Gold’s strength reflects the broader investor recognition of both the potential for significant liquidity expansion and the risks associated with money printing. Jeong notes that, in the past, those choosing Bitcoin as an inflation hedge were largely crypto-native. Today, however, investors in traditional finance increasingly recognize the need for risk hedges. Still, Bitcoin remains unfamiliar and volatile for some, prompting a near-term preference for gold as the more established asset. As understanding of Bitcoin deepens over time, a portion of investors who previously held only gold may diversify into Bitcoin. This can translate into medium- to long-term substitute and complementary demand for Bitcoin.

Tokenization and 24/7 Stock Trading: A Headwind for Altcoins, A Healthier Market Overall

The push into stock trading by Coinbase, tokenization efforts by Robinhood, and ongoing discussions at Nasdaq and DTCC about 24/7 trading and security tokenization are rapidly dismantling the boundary between traditional equities and crypto. If major U.S. big-tech stocks migrate to 24-hour trading, some of the short-term speculative flow that used to crowd into altcoins may shift into equities. Jeong partially agrees, but frames this as a cleansing effect that improves market quality. Projects reliant on mere hype and dumping will be weeded out, while tokens capable of real value creation can survive amid competition with equities. For investors, it becomes even more critical to assess whether a tokenized project creates intrinsic value and has the operational capability to deliver.

Corporate Holdings and Sell Pressure: How Much Should We Worry?

MicroStrategy holds an outsized amount of Bitcoin, and some companies may generate short-term pressure by selling Bitcoin or Ethereum. Jeong acknowledges this risk factor, but points out that whale selling has always existed in bull markets; when incremental demand dominates, prices still rise. In his framework, total demand matters more than isolated sell headlines. If rate cuts, liquidity expansion, and structural demand from institutional ETF adoption and portfolio allocation continue to flow in, corporate selling can be absorbed. There is little reason to turn overly pessimistic on this point alone.

Is the Four-Year Cycle Still Valid? Supply Alone Cannot Explain Price

Jeong is explicit that he does not rely on the four-year cycle thesis. There have only been three halvings so far, and generalizing from such a small sample invites statistical error. More importantly, halving is a supply-reduction event, while price is determined by the interplay of supply and demand. Early on, block-reward reductions had a larger price impact, but today the annual supply growth rate has fallen from the mid-1% range toward fractions of a percent, limiting the explanatory power of supply alone. He puts more weight on demand-side variables—especially macro liquidity and the strategic allocation of institutional capital. On this basis, he presents a 2025 fair value for Bitcoin of about $160,000. While a prior peak around $126,000 and current trading near $88,000 were discussed, he refrains from short-term bottom calls. Instead, he highlights that changes in Federal Reserve policy, leadership outcomes, and potential fiscal accommodation in the U.S. election cycle could directly support liquidity and help limit downside risk. Still, he cautions that if negative factors align simultaneously, heightened volatility would be unavoidable.

Nasdaq vs. Bitcoin: Competition Within Risk Assets and the Nature of ETF Flows

When liquidity expands and risk appetite broadens, some funds may prefer the relatively familiar volatility profile of the Nasdaq, potentially weakening Bitcoin’s relative strength. Even so, Jeong notes that strategic demand via ETFs continues to build, reducing the need to fixate on outflows. Moreover, much of the preemptive selling by participants who adhere to the four-year cycle may have already hit the market this year. As that supply is digested, conditions for a renewed trend higher could re-emerge.

Where Would KRW 100 Million Go? “If There’s No Need for Cash, 100% Bitcoin”

Asked about portfolio strategy, Jeong says that if he had no near-term spending needs, he would not hold cash. His choice is straightforward: a simple but consistent 100% Bitcoin allocation. This reflects a higher assessment of Bitcoin’s liquidity, institutional accessibility, and enduring narrative relative to individual altcoins. Of course, this is his personal view; investors should calibrate portfolios to their own risk tolerance, cash flow, and investment horizon.

Investor Checkpoints and Closing Thoughts

What the data confirm is that interest-rate levels directly influence liquidity within crypto, and that stablecoin balances have been highly sensitive to rate and market cycles. By contrast, the blanket claim that stablecoin growth “causes” Bitcoin’s price to rise should be approached cautiously and with data discipline. In this analysis, Jeong emphasizes demand-side drivers: institutional strategic allocation via ETFs, potential liquidity expansion tied to election and fiscal dynamics, and the long-term diversification that emerges from the differentiated roles of gold and Bitcoin. Rather than relying on the four-year cycle, focusing on macro conditions, capital flows, and the selection of assets capable of real value creation is more likely to determine cryptocurrency investment outcomes in 2025.