What are accommodative policies and how do they affect Bitcoin’s price?

Why Bitcoin’s Next Bull Market May Defy “Accommodative Policies”

Bitcoin’s last two major bull markets (2017 and 2020-2021) unfolded under historically loose monetary and fiscal conditions: near‑zero interest rates, massive quantitative easing, and record government deficits. Many traders now assume “for Bitcoin to go up, the Fed must pivot.”

That assumption may be outdated.

As Bitcoin matures in 2025-post-spot ETF approvals, after another halving, and amid structurally higher interest rates-its next bull market may decouple from the classic “accommodative policy” playbook.

The Old Playbook: Bitcoin as a Pure Liquidity Trade

How Accommodative Policies Fueled Past Crypto Cycles

In previous cycles, global liquidity clearly amplified Bitcoin rallies:

• 2013-2017:
• Central banks suppressed rates post‑GFC.
• Bitcoin grew from a niche asset to a speculative macro bet.
• 2020-2021:
• COVID stimulus > $10 trillion globally.
• QE, zero rates, and stimulus checks poured into risk assets.
• BTC: ~$4K (March 2020 crash) to nearly $69K (Nov 2021).

In this environment:

• Cheap leverage boosted crypto speculation.
• Institutional allocators framed Bitcoin as a “high beta tech trade.”
• Macro models treated BTC like a leveraged play on M2 growth and real rates.

Accommodative policies mattered-but they weren’t the whole story.

Why the “QE or Bust” Narrative May Be Broken

1. Bitcoin Is Institutionalizing Beyond Macro Fads

Since 2024, Bitcoin has gained infrastructure and legitimacy that reduce its reliance on short-term policy shifts.

Key milestones:

• Spot Bitcoin ETFs in the U.S., Europe, Brazil, Hong Kong and other markets:
• Lower friction for pensions, RIA platforms, family offices.
• Enable Bitcoin allocation inside traditional portfolio frameworks.
• Custody, reporting, and compliance tooling are now enterprise-grade:
• Big‑4 accounting coverage, regulated custodians, SOC‑2/ISO-compliant providers.
• Derivatives and liquidity depth:
• More robust CME futures and options volumes.
• Reduced slippage for large orders versus 2017 or 2020.

Institutions no longer need ultra-loose conditions to justify Bitcoin exposure. Instead, they can:

• Allocate as a small, strategic slice of a diversified portfolio.
• Treat BTC as a long-duration monetary asset, not just a speculative tech bet.

This alone weakens the tight correlation with “accommodative or not” narratives.

2. Scarcity Mechanics Are Hardening While Fiat Remains Structural Deficit-Driven

Bitcoin’s supply path is deterministic; sovereign currency supply is not.

Bitcoin’s Structural Tailwind: Halvings + Fixed Supply

• 21M BTC max supply; no central bank discretion.
• Halving in April 2024:
• Block subsidy: 6.25 → 3.125 BTC.
• Daily new supply cut in half.
• Historically, bull markets often follow halvings with a lag of 12-18 months, driven by:
• Miner sell‑pressure dropping.
• Demand not needing to rise dramatically to overwhelm supply.

Meanwhile, fiat systems remain anchored in persistent fiscal deficits and growing debt-to-GDP ratios.

Simple Macro Contrast

Even without “accommodative” shifts, investors may increasingly anchor on relative scarcity:

• Bitcoin’s issuance credibility vs. fiat’s structurally expansionary bias.

That dynamic does not require QE or zero rates to drive flows into BTC.

3. Bitcoin’s Narrative Mix Is Evolving: From Risk-On to Structural Hedge

Bitcoin has cycled through multiple macro narratives:

1. 2011-2016: Cypherpunk money / tech curiosity.
2. 2017: Speculative digital gold / high-beta tech.
3. 2020-2021: Macro asset leveraged to liquidity.
4. 2022-2024: Stress test through rate hikes, inflation spikes, and regulatory crackdowns.

In 2025, the narrative mix looks broader and more resilient:

• Digital gold thesis:
• Inflation concerns remain elevated vs. pre‑2020 norms, even if CPI retreats.
• Geopolitical tensions (trade wars, sanctions, capital controls) re‑emphasize neutral collateral.
• Sovereign and institutional diversification:
• Growing interest from smaller states in BTC as part of reserves or parallel systems (e.g., El Salvador’s precedent).
• Family offices and endowments increasingly view BTC as a non‑sovereign reserve asset, not just a trade.

As this thesis solidifies, Bitcoin can appreciate in environments where:

• Rate cuts are limited or delayed.
• Liquidity is neutral or even mildly restrictive.
• Yet trust in long-term fiat value and geopolitical stability steadily erodes.

Demand Drivers for the Next Bitcoin Bull Market (Independent of Policy Easing)

1. ETF and Structured Product Flows

Spot ETFs and regulated products can generate programmatic, rules-based demand, even in a non‑accommodative regime:

• Advisors incorporating BTC:
• Example frameworks:
• 1-3% BTC sleeve in 60/40 portfolios.
• Risk-parity or endowment-style allocations.
• Model portfolios and automated rebalancing:
• When BTC rallies, rebalancing may cap upside locally-but:
• On pullbacks, model-driven dip-buying can stabilize price.

This type of institutional DCA is less sensitive to the Fed’s dot plot than crypto-native traders imagine.

2. On-Chain and Layer‑2 Innovation Around Bitcoin

While Bitcoin itself is conservative, innovation around it is accelerating:

• Bitcoin L2s and rollups:
• Projects exploring rollup-style constructions and sidechains anchored to BTC.
• Drive new demand for BTC as settlement and collateral.
• Ordinals and inscription activity:
• Expanded the use of Bitcoin blockspace for NFTs, data, and experimental tokenization.
• Increased miner fee revenue, improving network security despite halving.
• Cross-chain collateralization:
• BTC used in DeFi on other chains via wrapped or native methods.
• Positions BTC as pristine collateral in multi-chain financial systems.

As utility and composability increase, BTC demand can rise even if macro liquidity isn’t overflowing.

3. Regulatory Clarity and Capital Market Integration

By 2025, the regulatory picture-while imperfect-has fundamentally changed versus 2017 or 2020:

• Clearer treatment of BTC as a commodity in major jurisdictions.
• Banking and brokerage integration:
• Bitcoin exposure offered alongside stocks and bonds.
• Lower friction means more “background adoption,” not just hype-driven spikes.

Regulatory clarity reduces the risk premium and lowers the bar for long-term strategic allocation, which is less macro-sensitive than short-term speculative positioning.

How a Non‑Accommodative Bitcoin Bull Market Might Look

A bull market that defies accommodative policy expectations may feature:

1. Moderate or even elevated real rates, yet:
• BTC grinds higher on structural allocation and scarcity.
• Less explosive, more staircase-like price action:
• Fewer parabolic spikes from cheap leverage.
• More steady inflows from ETFs, institutions, and sovereigns.
• Divergence from high-beta tech:
• BTC can rise even if frothier risk assets lag, driven by “reserve asset” and “digital gold” flows.
• Greater global diversification of demand:
• Growth in regions experiencing currency stress, capital controls, or political instability.

In such a regime, traders waiting solely for a dramatic policy pivot may miss the slow, structural repricing.

Conclusion: Bitcoin’s Next Cycle May Be About Structure, Not Stimulus

Bitcoin’s earlier bull markets undeniably benefited from hyper-accommodative monetary and fiscal conditions. But the asset in 2025 is not the same fringe experiment it was in 2017-or even 2020.

Key shifts:

• Institutionalization via ETFs and regulated products.
• Deterministic supply versus structurally expansionary fiat.
• Growing role as non‑sovereign collateral and digital gold.
• Increasing on‑chain utility and integration with broader web3 ecosystems.

The next Bitcoin bull market may unfold with or without a full return to zero rates and massive QE. Instead of hinging on “accommodative policies,” it may be driven by:

• Structural adoption,
• Credible scarcity, and
• A multi-decade re-pricing of non‑sovereign money in a leveraged, unstable fiat world.

For crypto‑native investors, that means updating models: watch not only the Fed, but also ETF flows, sovereign experiments, on-chain usage, and long-horizon allocation trends. The next breakout might arrive long before the policy regime looks “accommodative” again.