Crypto Market 2025: OG HODLers and TradFi Navigate Legal Clarity and Global Uncertainty

The cryptocurrency market in 2025 is defined by a delicate balance. Long-term holders are gradually exiting positions, while institutional capital flows in through regulated investment channels. With major legal reforms underway and geopolitical tensions rising, the market’s next phase will depend on renewed retail participation and sustained confidence from traditional finance.

Market Context: Legal and Geopolitical Volatility for OG Holders

Global Legal Changes in 2025

The year 2025 marks one of the most significant years for legal changes in cryptocurrency history, as major economic powers simultaneously deploy comprehensive legal frameworks. This change not only transforms how the market operates but also creates new drivers for industry development.

In the United States, the Trump administration has truly created a legal revolution in crypto policy. In January 2025, President Trump signed the executive order “Strengthening American Leadership in Digital Financial Technology,” affirming America’s leading position in digital finance. This order not only abolished restrictive policies from the previous administration but also established the Presidential Working Group on Digital Asset Markets, chaired by David Sacks – Special Advisor on AI and Crypto.

Particularly important is the SEC’s reestablishment of the Crypto Task Force under Commissioner Hester Peirce’s leadership, aiming to create clear compliance pathways instead of relying on lawsuits to shape policy. Paul Atkins – nominated as the new SEC chairman – and Brian Quintenz – candidate for CFTC chairman – are both individuals with deep cryptocurrency experience, signaling a new era with regulatory clarity.

Across the Atlantic, Europe officially implemented the MiCA (Markets in Crypto-Assets) regulation from December 30, 2024. This is the world’s first comprehensive crypto legal framework, creating unified standards for all 27 EU member countries. MiCA particularly focuses on regulating stablecoins – a crypto asset class becoming increasingly important with over $190 billion in global circulation.

Geopolitical Situation: Rising Geopolitical Tensions

2025 continues to witness escalating geopolitical tensions, and notably, cryptocurrency is becoming an important factor in the global “financial war.” Conflicts from Russia-Ukraine to Israel-Iran tensions all leave clear marks on the crypto market.

A particularly noteworthy phenomenon is how sanctioned countries are using cryptocurrency to break through economic barriers. Iran, with an economy isolated by sanctions, has encouraged industrial-scale Bitcoin mining to convert energy resources into borderless digital assets. In 2024, sanctioned organizations and countries received $15.8 billion in cryptocurrency, accounting for 39% of total illegal crypto transactions.

The market has reacted strongly to geopolitical events. In June 2025, tensions between Israel and Iran caused Bitcoin to drop to $103,556, leading to the liquidation of over $1.16 billion in leveraged positions within just 24 hours. This shows that cryptocurrency, despite being considered “digital gold,” still exhibits high-risk asset characteristics during periods of geopolitical instability.

Opposing Views on CBDC

An interesting point in this context is the clear division among major powers regarding Central Bank Digital Currency (CBDC). While the Trump administration has explicitly banned the development of America’s “digital dollar,” Europe is conducting “digital euro” trials in 2025, and the UK has also established a CBDC laboratory. This division reflects different philosophies about the state’s role in digital monetary systems.

Altcoin Market

Returning to technical analysis, when observing the overall market, we see a notable phenomenon: many altcoins are beginning to create lower lows than previous bottoms. In technical analysis, this is typically considered a warning signal, showing that selling pressure is increasing and investor sentiment is turning negative.

This situation has similarities to difficult recovery periods the market has experienced in the past, specifically the years 2014, 2018, and the first quarter of 2022. These periods all shared common characteristics: the market had to go through accumulation and purification periods before entering new growth cycles.

The combination of positive legal changes and pressure from geopolitical tensions is creating a contradictory market environment where no clear trend holds absolute dominance.

Changes in MicroStrategy’s Behavior

Michael Saylor MicroStrategy Bitcoin approach

A quite interesting phenomenon occurring is the change in Michael Saylor and MicroStrategy’s Bitcoin purchasing activities. Previously, MicroStrategy was considered a “barometer” measuring retail and institutional money flow into Bitcoin. However, from late 2024 to now, the amount of Bitcoin that Saylor announces purchasing has been trending downward.

This can be explained by the development of the Bitcoin investment ecosystem. Previously, when investment tools were limited, institutions wanting to access Bitcoin often had to buy MSTR shares. But now, with the emergence of many Bitcoin ETFs and other investment products, institutions have more choices, leading to capital flow being distributed rather than concentrated in MicroStrategy.

The Decisive Race: Two Opposing Forces

Currently, the market is witnessing an interesting confrontation between two forces with significant influence on Bitcoin’s price.

Selling: OG HODLers

The first side consists of OG HODLers – those who have held Bitcoin from very early on, when prices were still very low. This side currently holds approximately $1.2 trillion in unrealized profits, and they are continuously selling portions of their holdings.

This behavior is completely understandable from an investment psychology perspective. After many years of holding and witnessing value increase thousands of times, taking partial profits to ensure financial security is a reasonable decision. However, because they own large amounts of Bitcoin, this group’s selling creates considerable market pressure.

Buying: TradFi Institutions Keep Buying BTC through ETFs

On the opposite side, we have institutional investors – including investment funds, insurance companies, and large financial institutions. This group continues maintaining steady capital flow into Bitcoin through channels like ETFs, with average inflows of about $50-100 million.

Notably, positive news about ETF approvals, large companies buying Bitcoin, and participation by prestigious institutions continues to be announced regularly. Even Trump Media has joined this game. This shows that traditional financial world interest in Bitcoin remains high, especially after the legal environment became more favorable.

New Capital Flow Shortage

However, the biggest problem the market faces is not the confrontation between the two forces mentioned above, but the shortage of new capital flow from retail investors.

Data shows that people who bought Bitcoin during the most recent price increase (from $74,000 to $110,000) are showing signs of decline, meaning they are selling rather than continuing to hold. Meanwhile, the number of new buyers in the past month has not increased significantly.

This creates a paradoxical situation: new buyers lack patience and tend to sell quickly, while the most patient ones (OG HODLers) are leaving the game to take profits. This shortage is amplified by the impact of geopolitical events, making new investors more cautious.

TradFi’s Role

In this context, only the TradFi (traditional finance) group shows no signs of “collapse” or decreased interest. However, capital from this sector has unpredictable characteristics and is not completely transparent, making prediction more difficult.

Interestingly, U.S. banks are showing signs of restarting long-stalled crypto projects like custody, asset management, and stablecoins, thanks to positive changes in regulatory attitudes. Legal clarity may encourage more traditional financial institutions to participate deeper in the market.

The outcome of the race between these two sides will determine the market’s direction. If capital flow from institutional investors is not strong enough to balance selling pressure from OG HODLers, the current growth cycle may end here.

Conversely, if institutional capital flow maintains high levels and includes new retail participation, the market still has opportunities to create another growth “wave.”

The “Sideways” Phenomenon

Bitcoin’s current “sideways” condition, along with only a few altcoins rising while most are declining, is a direct manifestation of this confrontation. The market is in a precarious balance state where no force is strong enough to create a clear trend.

The fact that traditional financial markets and OG HODLers have “quite opposing behaviors” as mentioned in the article reflects deep division in views about Bitcoin’s long-term value. While financial institutions view Bitcoin as an asset with great potential in the future financial system, OG HODLers see this as an opportunity to take profits after years of patience.

Conclusion: The Future Depends on New Capital Flow

The cryptocurrency market in 2025 stands at a critical juncture. While regulatory clarity in the U.S. and Europe lays the groundwork for long-term growth, the lack of fresh capital from retail investors is holding back momentum. OG HODLers, with trillions in unrealized gains, are gradually exiting the market. Meanwhile, institutional investors continue to accumulate Bitcoin through regulated vehicles like ETFs—but their inflows alone may not be enough to offset mounting selling pressure.

The current sideways movement reflects this tension. Without renewed retail participation and a more patient investor base, the next bullish wave remains uncertain. For the market to regain upward traction, it needs not only favorable regulations and geopolitical stability, but also broader investor conviction in crypto’s