Nation-States and Central Banks Are Expected to Buy Bitcoin in 2025, Fidelity Says

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What to know:

  • 2025 is expected to be a game changer in terms of bitcoin adoption, the report said.
  • More nation-states, central banks, sovereign wealth funds and treasuries are expected to buy the cryptocurrency, Fidelity Digital Assets said.
  • A strategic bitcoin position could offset macro headwinds such as rising inflation, currency debasement and growing fiscal deficits, the investment firm said.

As an analyst, I find myself anticipating this year to potentially mark a significant shift in the recognition and integration of Bitcoin (BTC), the globe’s leading cryptocurrency, as suggested by Fidelity Digital Assets in their recent research report.

As an analyst, I predict that various nations, their central banks, sovereign wealth funds, and government treasuries may consider setting up strategic holdings in Bitcoin.

As a financial analyst, considering the escalating trends of inflation, weakening currencies, and ballooning government debt, refraining from investing in Bitcoin might prove riskier than actually allocating resources to it, according to the report’s findings.

Fidelity points out that both President-elect Donald Trump and Senator Cynthia Lummis have advocated for creating a strategic Bitcoin reserve within the U.S., though it’s uncertain whether this proposal will materialize in 2025.

Senator Lummis presented the “Bitcoin Act of 2024” to the Senate in July. Should this bill become law, as predicted by Fidelity, the strategic and financial dynamics at work may compel other countries to adopt similar measures.

In simpler terms, if countries decide to invest in Bitcoin, they might secretly acquire this digital currency because openly discussing it could lead other investors to also purchase Bitcoin, causing its value to rise significantly, according to Fidelity.

As an analyst, I’ve discovered that the United States, China, the United Kingdom, Ukraine, Bhutan, and El Salvador are the nations with the most significant government-held Bitcoin reserves, according to recent reports. Interestingly, these countries have primarily acquired Bitcoin through confiscations during government investigations into criminal activities and the subsequent recovery of associated Bitcoin assets.

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2025-01-08 12:51