Institutional Adoption and Market Maturity Fuel BTC’s Long-Term Potential

Bitcoin’s ongoing bull market is signalling a fundamental shift in its role within modern investment portfolios, according to new research from Fidelity Digital Assets. The report highlights how rising institutional participation, increased market maturity, and significant capital inflows are reshaping the cryptocurrency’s long-term position as a credible asset class.

A Maturing Market with New Momentum

The current Bitcoin market cycle, unfolding in the wake of the fourth halving in April 2024, showcases a departure from the sharp post-halving rallies of previous years. Fidelity notes that the 2024–2025 cycle is instead characterised by steadier, more sustainable growth. At block height 892,500—25% through the current halving epoch—Bitcoin was trading between $82,500 and $85,000, marking a 31% increase since the halving.

Daniel Gray, senior research analyst at Fidelity, pointed out a 50% surge in Bitcoin’s hashrate since the halving, a key indicator of the network’s resilience and growing miner confidence, despite block rewards being reduced to 3.125 BTC.

Stability in Metrics Reflects Market Confidence

The Puell Multiple—used to gauge miner revenue relative to Bitcoin’s price—has stabilised since the halving. This suggests that the market has absorbed the impact of reduced issuance without triggering major volatility. According to the report, the more subdued returns during this cycle may reflect the complex interplay of external macroeconomic headwinds and tailwinds.

“Bitcoin’s more muted returns likely reflect a market that is digesting several extrinsic tailwinds and headwinds, which have inevitably caused some uncertainty,” the report states. Historically, this mid-cycle phase has aligned with all-time highs—an occurrence that took place this week—fuelled by long-term investor confidence.

Realised Cap Shows Strong Capital Inflows

Bitcoin’s Realised Cap, a key metric measuring the total capital entering the market based on coin acquisition prices, has surged by 63% since the April halving. It climbed from $561 billion to $915 billion, underscoring the depth of investor interest in this cycle. This continued growth in Realised Cap with each halving indicates a pattern of increasing institutional trust and market maturity.

Fidelity believes this trajectory not only signals Bitcoin’s evolution as an investment asset but also strengthens its candidacy as a long-term portfolio component.

Institutional Interest at Record Highs

A defining feature of the current bull market has been the unprecedented level of institutional and corporate involvement. Since the US Securities and Exchange Commission approved spot Bitcoin exchange-traded funds (ETFs) in January 2024, over $134 billion has flowed into these investment products.

Meanwhile, centralised exchange trading has surged, with monthly volumes on Binance exceeding $1 trillion in March 2024. For comparison, volumes stood at just $11 billion in January 2018. This exponential growth points to broader market engagement and a deepening liquidity pool.

Corporates Set a New Standard

Publicly traded companies have also entered the fray with significant Bitcoin holdings. Strategy Inc. now holds over 576,000 BTC, acting as a blueprint for other corporates. Firms such as Metaplanet Inc., Bitcoin Group SE, and Semler Scientific have followed, reinforcing the idea of Bitcoin as a corporate treasury reserve asset.

Fidelity’s Gray concluded that “Bitcoin’s fundamentals and global recognition are stronger than ever,” supported by a convergence of factors that suggest sustained market growth, increased institutional anchoring, and structural resilience.

As Bitcoin continues to gain legitimacy in the eyes of both institutional investors and corporate leaders, its role within diversified portfolios is undergoing a major redefinition—moving from speculative asset to long-term store of value.