New research from Kraken economist Thomas Perfumo indicates that the cryptocurrency market is undergoing rapid changes. Factors such as macroeconomic pressures, institutional investor involvement, and evolving market structures are now playing a more significant role than speculative trading.
While Bitcoin continues to serve as an indicator of overall market risk, the dynamics of demand and liquidity within the crypto space have seen a long-term shift.
Bitcoin Demand Grows, but Prices Stay Steady
According to Perfumo's analysis, Bitcoin still functions as the primary signal for investor confidence. However, the forces influencing its price have evolved. Major entities such as U.S. spot Bitcoin ETFs and corporate companies acquiring Bitcoin for their balance sheets now exert considerable influence on pricing.
These sources injected substantial capital into the market during 2025. Despite this influx, prices did not experience the same level of increase seen in previous market cycles. Kraken's latest data reveals that these institutional channels generated approximately $44 billion in new Bitcoin demand throughout 2025.
Even with this robust demand, Bitcoin prices remained relatively stable. Long-term holders sold sufficient amounts of Bitcoin to satisfy the new demand, which effectively prevented sharp price escalations.
Concurrently, broader economic conditions continued to shape market direction. Slow global growth, rising inflation, and cautious central bank policies contributed to a reduced appetite for risk among investors, impacting both cryptocurrency and other asset classes.
Kraken also issued a warning that periods of market quietude can be deceptive. If liquidity were to tighten, sudden and significant price volatility could re-emerge, particularly if economic conditions worsen or financial policies remain restrictive.
Bitcoin Faces Slower ETF Flows as Investors Shift Assets
Kraken reports that the inflow of capital into Bitcoin ETFs experienced a slowdown in 2025 when compared to the preceding year. Additionally, Bitcoin treasury firms are currently facing pressure as stock market returns diminish.
With reduced access to new funding, these firms may encounter difficulties in stimulating another strong price rally unless market participants become more inclined to take on risk.
ARK Invest shares this perspective, highlighting the movement of capital between different asset classes. In 2025, gold experienced a significant rise while Bitcoin saw a decline. Despite this short-term weakness, Bitcoin's performance continues to diverge from traditional assets.
Its correlation with gold is less pronounced than the correlation observed between stocks and bonds. This characteristic positions Bitcoin as a valuable diversification tool during periods of economic uncertainty. Traders are now closely observing whether the flagship cryptocurrency can surpass the $100,000 mark or if it will retreat to lower support levels.
Some market analysts suggest that current prices appear undervalued when contrasted with U.S. stocks, particularly following months of divergent performance between these asset classes.
Tokenization and Stablecoins Set to Drive Crypto’s Next Phase
Beyond Bitcoin, Kraken anticipates that tokenization and decentralized finance (DeFi) will emerge as key drivers of growth in 2026 and beyond. The tokenized asset market has expanded rapidly over the past year, and major institutions expect this upward trend to persist.
Stablecoins are also at record levels and play a crucial role within the cryptocurrency ecosystem, facilitating trading, payments, and on-chain transactions. Simultaneously, new regulatory frameworks in the United States are beginning to influence the market. Proposed legislation for stablecoins and market reforms could determine the future landscape of innovation and potentially attract more institutional participants under clearer regulatory guidelines.