Galaxy Research has forecasted that Bitcoin (BTC), the largest cryptocurrency, is poised for substantial gains in 2025, with its price potentially reaching or exceeding $185,000 by the fourth quarter. This growth is expected to be driven by the growing involvement of institutions, corporations, and nation-states in the crypto market.

Ether (ETH), the second-largest cryptocurrency, is also projected to see significant growth, with its price anticipated to rise above $5,500 within the next year.

In the report, Alex Thorn, Galaxy’s head of research, emphasized that Bitcoin’s price surge will be largely fueled by the increasing adoption of Bitcoin by institutional investors, corporations, and governments. Galaxy predicts that five companies from the Nasdaq-100 and five nation-states will announce that they have added Bitcoin to their balance sheets or sovereign wealth funds in 2025. This competition among nations is expected to drive further Bitcoin adoption.

Galaxy also forecasts that U.S. spot Bitcoin exchange-traded funds (ETFs) will manage over $250 billion in assets by 2025, with at least one leading wealth management platform allocating 2% or more of its portfolio to Bitcoin next year.

The decentralized finance (DeFi) sector for Bitcoin is set to grow significantly, with Galaxy projecting that the amount of BTC locked in DeFi will double from its current $11 billion by next year.

Additionally, the report highlights that Bitcoin miners are increasingly transitioning to high-performance computing (HPC), and more than half of the top 20 largest publicly listed Bitcoin mining companies are expected to form partnerships with artificial intelligence (AI) firms or hyperscalers in 2025.

Galaxy also predicts that by next year, Bitcoin will capture 20% of gold’s market capitalization.