Emily Walker
A Fidelity Digital Assets report identifies a key factor impacting Bitcoin’s (BTC) growth in 2025: the increasing embrace of the cryptocurrency by governments and nation-states. It predicts that this year will be critical for BTC’s wider acceptance.
Government Adoption of Bitcoin to Drive Mainstream Acceptance
In 2024, there were notable advancements in Bitcoin adoption, including the SEC’s approval of the first US spot BTC exchange-traded funds (ETFs) and speculations about the creation of a strategic Bitcoin reserve after Donald Trump, a pro-crypto candidate, won the presidency in November.
The report, “2025 Look Ahead,” indicates that as both retail and institutional investors now leverage ETFs to invest in BTC, the next notable growth phase will emerge from nation-states. The report articulates this expectation:
We foresee 2025 as a transformative year for BTC acceptance and uptake. We expect various entities such as nation-states, central banks, and government treasuries to pursue strategic investments in Bitcoin, likely inspired by the successful approaches of Bhutan and El Salvador, which achieved significant returns in a short period.
Globally, the involvement of governments and nation-states in Bitcoin could significantly advance its mainstream recognition in 2025. Matt Hogan, a Research Analyst at Fidelity Digital Assets, pointed out that countries may face greater risks by not investing in BTC than by doing so.
Factors like soaring inflation, weakening currencies, and increasing fiscal deficits could lead nations to view Bitcoin as a missed chance for economic stability if not invested in.
Hogan mentioned the Bitcoin Act of 2024, proposed by US Senator Cynthia Lummis, aimed at creating a national strategic BTC reserve. The implementation of this plan is contingent on whether the Trump administration will endorse it.
Should the act be passed, it could set off a ripple effect in political and financial strategies, compelling other countries to consider similar measures. Notably, governments aiming to accumulate BTC may opt for cautious strategies to prevent market disruption and price surges.
Countries Considering Bitcoin Reserves
El Salvador and Bhutan have successfully set up national BTC reserves, and other nations are now looking to follow suit. In December 2024, a federal deputy in Brazil proposed legislation to include BTC in the diversification of the country’s National Treasury.
Additionally, countries such as Chile, Canada, and the Czech Republic are rumored to be evaluating the creation of their own BTC reserves. As of the latest reports, BTC is trading at $94,190, reflecting a 3.4% decline over the past day.