Crypto Market Macro Research Report: Policy Resonance and Market Recovery, Bitcoin Reaches New Heights

I. Macroeconomic Background: Policy Easing and Shift in Market Sentiment

In May 2025, the People's Bank of China implemented a "double reduction" policy, lowering the reserve requirement ratio by 0.5 percentage points, releasing about 1 trillion yuan of long-term liquidity, while also reducing the policy interest rate by 0.1 percentage points to 1.4%. This policy not only has a profound impact on traditional financial markets but also brings potential opportunities for the crypto market and the Web3 ecosystem. At this time, expectations for high-level economic and trade negotiations between China and the United States are positive, further driving a shift in global market risk appetite.

1.1 The easing of China-U.S. relations has improved market sentiment.

With the release of the "double reduction" policy by the People's Bank of China, market expectations for a thaw in China-U.S. relations have significantly increased, leading to a general rise in the prices of risk assets, especially in the crypto market. This sends an important signal: the monetary easing cycle has begun, and economic growth is expected to receive new support. Against this backdrop, market liquidity will be released, and enthusiasm for traditional asset investment is surging. High-level economic and trade negotiations between China and the U.S. are about to take place, further enhancing market optimism. These policy signals have reshaped investor sentiment, bringing positive effects to the crypto market. The rise of risk assets such as Bitcoin is a direct reflection of the shift in market sentiment.

1.2 Global Liquidity Easing

China's "dual reduction" policy has significant global influence. By lowering the reserve requirement ratio and interest rates, the People's Bank of China injects ample liquidity into the market. This monetary easing not only has a positive effect on the Chinese economy but may also trigger changes in global capital flows. Especially against the backdrop of the U.S. economy facing high inflation and high unemployment risks, China's policy appears even more attractive. The global capital market reacts positively to this, actively seeking new investment channels. Bitcoin, as "digital gold," stands out in the global monetary easing environment, becoming an important tool to combat inflation and currency depreciation.

1.3 Federal Reserve policy trends

The trend of the Federal Reserve's monetary policy is also a focus of market attention. Recent economic data shows that while the U.S. economy is steadily expanding, the dual pressures of high inflation and high unemployment pose greater challenges for Federal Reserve policy. The market generally believes that the Federal Reserve will maintain its current interest rate policy in the short term to avoid excessive stimulation of the economy. This has led to a strengthening of the dollar, which has far-reaching effects on global capital flows. Despite the strength of the dollar, demand for crypto assets has not significantly declined; instead, there has been a resurgence in the interest of "digital gold" as a safe-haven asset.

1.4 Investment Strategy Recommendations

Overall, the resonance of U.S.-China policies and the shift in market sentiment will have a profound impact on the global market, especially the crypto market. With the increase in global risk appetite, the demand for cryptocurrencies has surged. The price of Bitcoin is nearing its historical high of 100,000 dollars, indicating a high level of market recognition. However, investors still need to be cautious in dealing with potential risks. It is recommended to adopt a "core+satellite" investment portfolio, using Bitcoin as the basic allocation of digital gold, and to pay attention to Web3 projects with practical application scenarios, especially in innovative fields such as cross-border payments and digital identity authentication.

2. Bitcoin Market Dynamics: Price Approaches 100,000 USD

Bitcoin is showing a strong upward trend in 2025, with prices frequently approaching the historic threshold of 100,000 dollars. The forces driving this round of increase are complex and diverse, including the resonance of macro policy backgrounds, structural evolution within the encryption industry, and a two-way game of emotions and expectations. In the current situation where the traditional financial system faces widespread uncertainty, Bitcoin has re-entered the center of global capital vision, reflecting both the concentrated release of safe-haven demand and the reality of institutional recognition, influx of institutions, and valuation reconstruction.

The biggest characteristic of this round of rise is that institutional investors have become the dominant force. Mainstream asset management institutions are actively laying out Bitcoin ETFs, pushing Bitcoin towards institutional allocation. Financial products targeting encryption assets in places like Hong Kong and Dubai are becoming increasingly rich, allowing Bitcoin to enter more traditional capital pools in a compliant manner. The inclusion of such institutional-level funds not only enhances market depth and stability but also reduces the previous volatility structure that was "purely emotion-driven."

The scarcity logic on the supply side continues to amplify Bitcoin's value anchoring ability. The fourth halving in April 2024 will reduce the block reward from 6.25 coins to 3.125 coins, greatly compressing new supply. On the demand side, there is exponential growth driven by multiple factors such as ETF listings, central bank purchases, sovereign fund allocations, and a global increase in hedging. The asymmetry in supply and demand structure constitutes the fundamental support for the medium to long-term price increase.

However, the process of Bitcoin approaching $100,000 is also accompanied by intense emotional fluctuations and technical adjustments. The market has concentrated trading from whale accounts, high-frequency algorithms, and large arbitrage trades, leading to sharp short-term fluctuations. Some old funds are taking the opportunity to distribute, combined with retail investors' "fear of heights" sentiment, triggering a phased correction. The market structure is transitioning from early believers to mainstream incremental users.

The media widely promotes the historical significance of Bitcoin approaching $100,000, creating a strong "FOMO effect" and attracting a large number of retail investors for short-term participation. This media-driven enthusiasm also brings about typical "bubble expectations", with some short-term funds exhibiting excessive speculation, making them prone to triggering a cascading liquidation at critical points. Although long-term logic supports a price breakthrough to new highs, there remains the possibility of severe fluctuations in the short term, as the market enters a phase of heated competition between enthusiasm and risk.

Overall, Bitcoin is approaching $100,000, which is the result of a resonance between technical and policy aspects, and also represents its leap in asset positioning within the global capital system. Under the framework of de-dollarization, a resurgence of global risk aversion, and the entry of institutional funds, Bitcoin has become a strategic asset in the new round of global wealth redistribution. Although there are short-term adjustment risks, this round of rising is not a fleeting phenomenon in the medium to long term, but rather the starting point of a new consensus cycle. Investors need to seek a balance between enthusiasm and calm, understanding that Bitcoin is not only about price, but also a resonance of faith, institutions, and the era.

3. Web3 Ecosystem Development: Dual Drive of Policy and Technology

With the easing of macro policies and key technological breakthroughs, the Web3 ecosystem is entering a new development cycle. It is no longer just a tool for speculation on crypto assets but is gradually evolving into a foundational architecture for global digital governance, cross-border collaboration, and the value internet. The three forces of policy guidance, technological innovation, and application expansion are overlapping and driving Web3 from concept to large-scale implementation.

1. Policy Support

Since 2025, U.S. cryptocurrency and Web3 policies have shifted from "regulatory suppression" to "strategic acceptance." New Hampshire has passed the "Bitcoin Reserve Bill," requiring the state government to hold a portion of its financial reserves in the form of Bitcoin. This marks Bitcoin as a "digital gold" that is seen as having long-term value storage capabilities in certain jurisdictions, serving functions against inflation and enhancing fiscal independence. The bill provides a "pilot template" for other states, potentially triggering a trend of "local government BTC adoption," injecting long-term institutional funds into the Web3 ecosystem.

In a broader sense, multiple states in the U.S. are in the early stage of "policy competition." Texas, Wyoming, and others are advancing experimental legislation for compliance in encryption mining, on-chain finance, and smart contracts. At the federal level, the "Financial Innovation and Technology Future Act" is being promoted, proposing to define mainstream digital assets as "non-security commodities" and establish a unified regulatory framework. These dynamics strengthen the market's long-term institutional confidence in the Web3 ecosystem and provide policy anchors for businesses and capital to enter.

From an international perspective, the shift in the United States has "spillover effects". As a global center for capital and technology, America's proactive legislation may drive other countries or regional markets to "policy follow", promoting global Web3 capital flow and ecological collaboration.

2. Technical Progress

Modular blockchain and zero-knowledge proof ( ZKP ) and other infrastructure technologies have entered the practical stage, significantly enhancing the performance, composability, and privacy protection capabilities of the Web3 network. Modular blockchain separates execution, settlement, and data availability, allowing developers to choose the optimal combination based on business needs. ZK technology endows Web3 with dual capabilities of "computation + privacy," with ZK-rollup as the core solution of Ethereum Layer 2 entering large-scale deployment.

In addition, the MCP( Model Context Protocol), which integrates AI with Web3, has initially taken shape. It aims to chain the training, invocation, and verification processes of AI models on-chain, enabling "on-chain intelligence" to possess self-evolution capabilities. These new paradigm technologies are breaking through the original bottlenecks of the Web3 system, making it possible for on-chain applications to compete with the experiences of Web2.

3. Application Scenario Expansion

In terms of cross-border payments, an increasing number of small and medium-sized export enterprises and digital service providers are beginning to use stablecoins for direct settlements, avoiding the issues of exchange rate fluctuations and the low efficiency of traditional financial transfers. This is especially true in emerging markets such as Southeast Asia, Latin America, and the Middle East, where Web3 payments have become a practical trend.

Digital identity authentication ( DID ) has become an important breakthrough for the implementation of Web3. On-chain verifiable identity systems are integrated into DAO governance, DePIN device access, cross-chain credit evaluation, and other aspects to address the fundamental issues of "who is the user" and "who owns the data." On-chain social, gaming, citizen voting, and educational qualification verification scenarios are also experiencing explosive opportunities due to the maturity of the DID system.

Looking more broadly, the Web3 ecosystem forms three types of "application drivers": first, the demand for "chain reform" upgrades in traditional industries; second, the evolutionary advancement of native encryption demands; third, the cultural resonance of global youth and developers for free collaboration and value sovereignty.

4. Risk Factors and Investment Strategies

Despite the current strong growth trend in the Web3 ecosystem and the Bitcoin market, investors still need to pay close attention to potential systematic and non-systematic risks. In the context of the ongoing escalation of long and short forces, and the increasingly complex interplay between policies and the market, it is particularly crucial to formulate rational and forward-looking investment strategies.

Main risk factors:

1. The direction of global interest rate policies is highly uncertain. If inflation data rises again or geopolitical conflicts intensify, it may force the Federal Reserve to shift back to a hawkish stance, impacting the valuations of risk assets.

2. Regulatory disturbances remain a significant external variable. Before the new regulatory framework is officially implemented, there exists a gray area in the enforcement standards of regulatory authorities, which may lead to "selective enforcement" on core infrastructure.

3. The technical risks of on-chain ecological systems cannot be ignored. New technologies such as zero-knowledge proofs, Layer 2 bridging, and modular blockchains still face issues such as being susceptible to attacks, code vulnerabilities, or immature protocols.

4. The structural differentiation of the market may lead to phase bubbles. Hot assets emerge one after another, and there are instances of speculative funding, with some projects potentially being overvalued.

Investment strategy advice:

1. Those with a lower risk appetite should treat Bitcoin as a "crypto market asset anchor" for long-term allocation, gradually increasing positions during pullbacks, and prioritizing holding mainstream assets with institutional recognition.

2. Growth-oriented investors can focus on projects in the infrastructure track that have real application implementation, an active developer ecosystem, and a clear protocol upgrade path, such as Layer2, ZK, modular chains, DePIN, etc., but should avoid heavily investing in short-term hot spots.

3. The operational strategy adopts methods such as phased building of positions, rolling adjustments, and setting take-profit and stop-loss intervals for dynamic management, avoiding extreme decisions driven by emotions.

4. Strengthen the consideration of "policy sensitivity" in project selection, prioritize the layout of emerging projects that grow under clear compliance trends, and enhance the portfolio's risk resistance capability.

5. Conclusion

In the first half of 2025, the crypto market will enter a new round of structural bullish cycle driven by the resonance of policies, warming liquidity, and accelerated technological innovation. Bitcoin continues to gain mainstream financial recognition, with prices approaching the $100,000 mark; the Web3 ecosystem further expands application scenarios with the help of policy inclusiveness and breakthroughs in underlying technology. However, uncertainties in policies, regulatory uncertainties, market speculation, and technical security risks still exist. Looking ahead to the second half of the year, investors should maintain calm judgment in the midst of structural prosperity and follow value.