Bitcoin wrapped up 2025 on a rough note, closing the year at $87,496 — down 6% from its end-of-2024 price of $93,381. Spot Bitcoin ETFs didn’t do much better, with $348 million in net outflows across all 12 available funds. Ethereum ETFs also struggled, losing $72 million with no new money coming in.

Despite the broader decline, there were a few bright spots. Solana and XRP ETFs saw small gains, bringing in $2.29 million and $5.58 million respectively. These minor inflows stood out in an otherwise bearish market.

Adding to the drama, the Federal Reserve pumped $74.6 billion into the financial system through its Standing Repo Facility — the largest one-day liquidity injection since the COVID era. Banks used the funds to meet year-end cash demands by borrowing against U.S. Treasuries and mortgage-backed securities. While this wasn’t considered emergency action, it signaled that the Fed might be more flexible with monetary policy heading into 2026 — a positive sign for riskier assets like Bitcoin.

Institutional investors remain optimistic. Charles Schwab strategist Michael Townsend pointed to earlier regulatory uncertainty as a major factor holding Bitcoin back, suggesting that it had suppressed Bitcoin’s value by up to 50%. With clearer regulations after the U.S. elections, he believes Bitcoin could see significant upside — especially if the Fed continues easing and government debt demand weakens.

Townsend also said lower interest rates and reduced appetite for U.S. Treasuries could fuel demand for high-volatility assets like Bitcoin. However, Schwab’s own crypto trading platform is facing delays and may not launch until mid-2026, slowing their ability to fully act on their bullish outlook.

Still, not everything looks rosy. ETF data shows weak retail interest in both Bitcoin and Ethereum. Their 30-day moving averages stayed negative as 2025 ended. Technical indicators showed that Bitcoin has returned to an “Extreme Fear” zone on the Fear and Greed Index — a level that previously led to price doubling within three months.

Looking ahead to 2026, analysts see a mixed picture. CryptoQuant laid out three possible scenarios: the most likely being a range-bound market between $80,000 and $140,000 due to unpredictable ETF inflows and ongoing macro uncertainty, especially with upcoming U.S. midterm elections. A recession could pull Bitcoin down to $50,000, while a best-case scenario driven by economic easing could lift prices as high as $170,000.

Timot Lamarre from Unchained explained that investors in 2025 redirected capital into sectors like AI and gold instead of crypto. He also warned that rising U.S. debt could limit how aggressive policymakers can be ahead of the elections. But if monetary policy loosens, Lamarre believes Bitcoin will benefit from cheaper and more available dollars.

Institutional progress did continue in 2025. Vanguard finally opened its doors to crypto by allowing users to trade ETFs linked to Bitcoin, Ethereum, XRP, and Solana — a big step toward mainstream adoption. Earlier in the year, the CFTC also approved spot crypto ETFs for trading on registered futures exchanges.

Longtime Bitcoin investor Michael Terpin offered a cautious take, predicting a prolonged bear market similar to past post-halving years like 2014, 2018, and 2022. He expects Bitcoin might bottom near $60,000 in early fall before starting its next big recovery that could extend into 2028 or 2029. While there’s still a chance for a new all-time high in 2026, Terpin thinks it’s becoming less likely over time. However, he sees late 2026 as a strong accumulation window ahead of the next major supply shock post-halving.

In summary, while institutions remain hopeful about Bitcoin’s long-term future, short-term trends show weakness in ETF demand and ongoing macro challenges. But with the Fed showing signs of easing up and more platforms embracing crypto trading, conditions could improve if investor sentiment shifts in 2026.