BTC rises 9.7%, facing challenges from Trump's economic policies

In January 2025, Bitcoin (BTC ) continued its strong performance from the previous month, rising again by 9.7%, reaching a historic high of $109,358.01. The closing price at the end of the month was $102,411.26, far exceeding the gains of the Nasdaq index and gold during the same period.

This month's market performance has been influenced by multiple factors. First, the Federal Reserve paused interest rate cuts as expected, but this did not hinder the rise of BTC. Second, the inauguration of the new U.S. president has brought about a series of crypto-friendly policies, including the establishment of a digital asset market working group. Furthermore, several U.S. states are advancing proposals for a "Bitcoin Strategic Reserve," which continue to make progress, injecting positive signals into the market.

These favorable factors have driven over $16.4 billion in funds into the crypto market in January. From a technical perspective, the BTC price has formed a box structure between $89,000 and $110,000, which can be referred to as the "Trump bottom." This range reflects the market's expectations for the new government's crypto-friendly policies.

However, the market also faces new challenges. The news of the Trump administration announcing tariffs on multiple trading partners has raised concerns about rising inflation. This could lead the Federal Reserve to further adjust its interest rate cut expectations, or even consider raising rates, thereby putting pressure on the high-performing stock market and BTC.

In terms of capital flow, January continued the strong trend of the previous months, with a net inflow of 16.406 billion USD. However, it is worth noting that if future capital inflows slow down, the BTC price may face the risk of a sharp short-term adjustment.

The selling behavior of long-term investors continues, but the scale is decreasing month by month. Currently, the number of BTC distributed in the range of $89,000 to $110,000 has reached 4,138,554.23, accounting for 24.22% of the total supply. This portion of chips has formed a new support level, mainly coming from purchases by institutional investors.

Looking to the future, the BTC market is entering a new stage of development. New holders are entering the market at higher prices, pushing BTC to re-evaluate its value in new scenarios. However, the economic policies of the Trump administration may bring uncertainty, especially regarding their impact on interest rate cut expectations and the supply of funds. If liquidity is restricted, market volatility could significantly increase.

Overall, BTC is preparing to break through to the next price range after completing the "Trump bottom" construction. However, changes in the external environment still need to be closely monitored, and investors should remain vigilant, paying attention to policy trends and their potential impact on the market.