Bitcoin soars to a new all-time high

Welcome to the Canadian Crypto Observer. Financial journalist and author Aditya Nain offers perspective on market-moving headlines to help Canadian investors navigate the cryptocurrency market.

Could bitcoin continue to rise?

On May 22, bitcoin (BTC) reached a new all-time high of $111,681 (all figures in U.S. dollars unless otherwise specified). This was likely driven in part by the ongoing “sell U.S.” trend, with uncertainty around Trump-led policy pushing investors towards non-U.S. assets, including gold and bitcoin.

Source: Google Finance as of May 27, 2025

Could it go higher? Or is the crypto party over for this market cycle? Here’s some useful perspective.

What’s the Fear and Greed Index telling us?

When BTC first neared the key psychological threshold of $100,000 in December 2024, two indicators suggested that the market could be overheated: the CMC Fear and Greed Index and Google search volume for “bitcoin.” This time, those same indicators give us reason to believe that BTC could rise further.

Below is the one-year chart of the CMC Fear and Greed Index (multi-coloured line), overlaid with the price of BTC (grey line). You’ll notice that when BTC neared $100,000 in December, the index was at “extreme greed,” suggesting a market top. But now, with BTC at a new all-time high, the index is still in “greed” territory—which indicates that the market may not be overheated yet.

Graph comparing Fear and Green Index to bitcoin prices — Source: CMC Fear and Greed Index 1-year data as of May 27, 2025

What can Google search trends tell us about BTC?

Data from search query tool Google Trends suggests to me that BTC could rise further. Typically, close to or at new market highs, search interest in “bitcoin” on Google goes through the roof, as it did, for example, in March 2021 and November 2024. However, we’re not seeing that burst of search interest just yet. The search volume for BTC—how many times “bitcoin” was searched for on Google and its associated platforms like YouTube—is less than half of what it was in December.

The chart below shows that interest in bitcoin peaked in December 2024 (coinciding with the market top at that time). This peak is represented numerically by a score of 100. In contrast, the interest in bitcoin as of May 27 sits at a very low score of 34.

Graph of Google's bitcoin searches over one year — Source: Google Trends as of May 27, 2025

To reiterate: I wouldn’t be surprised if BTC rose further, because the BTC market usually tops out when it’s over-hyped, when it’s making regular headlines, and greed is extreme. For now, we’re not seeing evidence of that based on the Fear and Greed Index or the Google search trends data.

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Ethereum bounces back

Ethereum (ETH) has risen from the ashes—up 62%, from $1,416 to $2,700, in under two months in April–May 2025. The second-largest cryptocurrency by market capitalization, ETH was beginning to lose favour with investors, having lagged behind BTC, Solana (SOL) and many other crypto assets in this bull market. However, as is often the case in investing, just when you think an asset is doomed, it shoots up—and ETH did, quickly.

What’s behind ETH’s resurgence?

It could be creator Vitalik Buterin’s strategic plan to level up Ethereum’s technological infrastructure, in response to chronic underperformance and the emergence of several competitors such as Solana. However, if you’re bearish on ETH, you may think that the current run-up is just a contra play—that is, investors piling into ETH because it was deeply undervalued.

I think it’s safe to say the jury is still out on whether Ethereum survives and thrives or gets eaten up by newer, more agile crypto competitors in the next five to 10 years.

Despite the largely negative news surrounding Ethereum over the past year, there’s one major success story at the intersection of traditional finance (TradFi) and crypto. It’s called BUIDL—a tokenized money market fund by BlackRock that runs largely on the Ethereum blockchain. It’s a way to hold U.S. Treasuries through a crypto token.

BlackRock’s BUIDL fund hits $2.88B, with 95% on EthereumAs of May 18, BlackRock’s tokenized fund BUIDL holds $2.88 billion in assets, with $2.68 billion (95%) tokenized on Ethereum, according to data from https://t.co/hPAEaqWKKv. The remaining assets are spread across Aptos,…

— CoinNess Global (@CoinnessGL) May 19, 2025

As of May 29, the BUIDL market cap stood at an impressive $2.92 billion—up over 600% from its launch in March 2025. Could Ethereum be the preferred blockchain for the tokenization of traditional and real-world financial assets?

Will stablecoin regulation in the U.S. boost crypto growth?

Something happening in the U.S. could be big for crypto. The federal government is trying to regulate U.S.-dollar stablecoins—cryptocurrencies that are stable in value because they’re pegged to the U.S. dollar. For example, one Tether (USDT, the largest stablecoin on the market) is meant to be equal to one U.S. dollar.

Through the bipartisan Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, regulators hope to impose requirements on stablecoin issuers, such as how much U.S. currency they must keep in reserve to back up their coin, ultimately ensuring that regulated stablecoins will maintain their value. As of now, the Act is on the floor of the Senate. Once it’s passed by the Senate and the House, it will need President Trump’s signature. While it’s not yet a done deal, some form of stablecoin regulation could likely be law as soon as next year.

Stablecoins are a key part of the crypto ecosystem because they function as on and off ramps for investors. For example, if you want to buy $1,000 of BTC but not all at once, you may buy $1,000 of USDT and convert that incrementally to BTC. When you want to sell your BTC, you may convert it to USDT instead of selling it for U.S. dollars. Think of stablecoins as the “cash” of the crypto ecosystem. They’re so important that two of the 10 largest cryptocurrencies by market cap are stablecoins: USDT (third-largest at $152 billion) and USDC (seventh-largest at $61 billion), as of May 27, 2025. In fact, almost unbelievably, in April 2025 stablecoins accounted for over 50% of on-chain transaction volume, as the table below shows.

Bar graph of transaction volumes by crypto type — Source: Chainalysis.com as of May 27, 2025

For central banks and governments, an unregulated stablecoin ecosystem poses significant risk. If you’re holding a crypto token that claims to be equal in value to the U.S. dollar, then that token should be backed more than adequately by U.S. dollars—otherwise, it’s just an empty promise. A well-regulated stablecoin ecosystem would likely boost investor confidence in crypto, inviting more people into the market. For example, if an investor knew that USDT functioned within a well-regulated ecosystem, they’d be more likely to convert their BTC to USDT and back, based on their outlook on the crypto market. An added benefit could be the potential to pay for real-world things with your stablecoin, thereby reducing the need to move out of the crypto ecosystem to make a purchase.

Crypto price swings are common

Cryptocurrencies including Bitcoin, Ethereum, Solana, XRP and others are speculative and highly volatile assets that are subject to significant price swings. Even stablecoins may not be “safe” if not backed adequately by real-world assets.

Investing in bitcoin and other crypto coins carries significant market, technological and regulatory risks. Invest in crypto only if it aligns with your investment goals, time horizon and risk profile, and stay vigilant about crypto scams.

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