July 28, 2025 – FXEmpire – After a sharp sell-off last week triggered by large-scale Bitcoin transfers, the cryptocurrency market has swiftly reversed course, with major tokens bouncing back and investor sentiment stabilizing. As of Monday, total crypto market capitalization surged by 2.4% over the last 24 hours, reclaiming the $4 trillion mark a level not seen since early 2022.
The rebound follows the market’s digestion of bearish pressure that originated from Galaxy Digital’s sale of over 80,000 Bitcoin, a historic move worth more than $9 billion. Analysts feared this would trigger panic, but the crypto ecosystem displayed unexpected resilience.
“The market completely absorbed the sell-off,” said Jason Williams, author of Bitcoin Hard Money. “This is a bullish signal for the months ahead.”
Bitcoin Holds Range, Ethereum Breaks Out
Bitcoin (BTC), which briefly dipped below $115,000 on Friday, has stabilized between $116.5K and $119.5K. Traders are now watching the upper limit of this range closely, with a $120,000 breakout expected to trigger speculative inflows.
Meanwhile, Ethereum (ETH) has emerged as the star of this recovery. ETH climbed to $3,925, inching toward the psychological $4,000 barrier that has repeatedly acted as resistance since late 2023.
According to FXEmpire’s market update, Ethereum has attempted to break past $4,000 three times in the past year. While each rally was followed by declines ranging from 30% to 65%, this current trend reflects stronger fundamentals and broader capital inflows.
If ETH breaches $4,000, analysts expect a swift move toward its all-time high of $5,000, last touched in late 2021.
Network Fundamentals Support the Rebound
Bitcoin’s fundamentals remain strong, despite the recent sell-off. A new difficulty adjustment raised mining difficulty by 1.07% to a record 127.62 TH/s, with the network’s hash rate surpassing 1 ZH/s. This signals growing miner confidence and continued network security.
At the same time, capital inflows into crypto markets are accelerating. According to JPMorgan, over $60 billion has entered the market in 2025 alone a 50% increase since the end of May. The influx is driven primarily by institutional investors, CME futures trading, and a resurgence in crypto-focused venture capital.
Liquidity Tailwinds Fuel $200K Bitcoin Talk
Adding to the optimism, some analysts have raised their long-term targets for Bitcoin in light of macro liquidity trends. A recent analysis argued that if global M2 money supply growth persists, Bitcoin could surge toward $200,000 by the end of 2025.
The forecast is based on historical correlations between M2 expansion and crypto bull cycles, with analysts noting an 8 to 12 week lag between liquidity surges and Bitcoin price rallies. As global M2 climbs above $112 trillion, the stage may be set for a major breakout.
Changing Narratives: Cycle Theory Abandoned?
The macro view of the crypto market is also evolving. Ki Young Ju, CEO of CryptoQuant, admitted that traditional Bitcoin cycle theories no longer apply under current market conditions. He had previously predicted a price ceiling near $120,000 this cycle, but he now concedes that BTC may not follow past four-year halving patterns.
Bitwise Asset Management has also published a report arguing that the forces shaping earlier cycles such as limited institutional participation and predictable miner behavior have “significantly weakened” in 2025.
Social Metrics Signal Market Euphoria
Ethereum’s rally has ignited social media buzz, with mentions on platforms like X (formerly Twitter) and Reddit reaching multi-month highs. This spike in “extreme euphoria” could signal a short-term correction if traders begin profit-taking en masse.
However, some argue this surge in online activity reflects long-awaited enthusiasm after months of muted market performance.
Outlook: Bullish but Cautious
Despite recent strength, analysts caution that macro uncertainties including interest rate guidance from the Fed and the looming U.S.–EU trade deadline could introduce fresh volatility. Bitcoin and Ethereum have decoupled somewhat from equities in recent weeks, but broader risk appetite still matters.
A break above $120K for BTC and $4K for ETH would validate this week’s bullish narrative. Conversely, failure to hold current levels could invite renewed selling pressure.
As traders and institutions regroup for the next leg of the cycle, the key question remains: is this just a relief rally or the beginning of a new phase in crypto’s 2025 bull market?
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