As traditional financial markets fluctuate, Bitcoin once again proves its unique market position.
Coinmarketcap data shows that on May 21st during US stock trading hours, Bitcoin price surged to a record high of $109,767.52, with market capitalization momentarily breaking $2.16 trillion, surpassing Amazon to become the fifth most valuable asset globally. At the time of writing, BTC trading price has retreated to around $108,000, with a 24-hour increase of 1.8%.
Amid heightened market sentiment, Michael Saylor directly stated: "If you don't buy Bitcoin at historical highs, you're missing an opportunity."
A Time Bomb in Traditional Markets?
On the same day Bitcoin hit a historic high, the US Treasury market seemed to be experiencing a "crisis". After the weak demand for a 20-year US Treasury bond auction was announced, US stocks, bonds, and currencies all plummeted. Deutsche Bank analyst George Saravelos viewed the market reaction as a clear signal of "foreign buyers collectively avoiding US debt assets". The 10-year US Treasury yield momentarily rose to 4.607%, the highest since February 13th, while the US Dollar Index dropped 0.5%.
"This is a hidden time bomb," warned Josh Mandell, a former fixed income expert and current Bitcoin analyst. He explained: "We used to say that a 'failed auction' of 30-year bonds would be a disaster... If not for the Federal Reserve's intervention, we might now be facing default risks from bond rollover failure."
This warning was quickly verified in the stock market, with the Nasdaq index plummeting 1.5% in an hour and the S&P 500 dropping 1.3%. Such violent market fluctuations precisely explain why more funds are flowing into the Bitcoin market.
Renowned market analyst Benjamin Cowen discussed in his podcast that during Bitcoin bear markets in 2014, 2018, and 2022, bond yields rose while other risk assets declined. This situation increased government borrowing costs and had a chain reaction across economic sectors like mortgages and corporate financing. Between 2015 and 2025, while markets often amplified Bitcoin's macroeconomic correlation, its own market logic and cyclical patterns were sometimes more critical. Therefore, Bitcoin's correlation with bond yields would fluctuate with changing environments.
Now in May 2025, this correlation has dropped to a historical low - Bitcoin remains strong even in a high-yield environment. This "abnormal" trend suggests investors might be reallocating assets.
By the close of US stocks on Wednesday, the Dow dropped 1.69%, the S&P 500 fell 1.16%, and the small-cap index plummeted 2.35%. These declines, combined with rising bond yields, indicate funds are fleeing traditional assets.
$110,000: A Critical Battlefield for Bulls and Bears
In this context, every key price point for Bitcoin becomes crucial. Renowned crypto trader Skew pointed out on X platform that $110,000 has become the critical battlefield in the current market structure. According to his analysis, a large number of sell orders are concentrated around this price, with Binance perpetual contracts showing significantly more sell orders than buy orders, and short positions accumulating.
"All of this indicates huge liquidity, which is usually critical to the market," Skew explained.
This observation aligns with Kretov's view: "Structurally, there's space for an explosive rise, but a violent pullback could happen at any moment."
Deeper market data analysis reveals more details. Bitcoin's 24-hour trading volume surged 34.67% to $6.69 billion, showing significantly increased market activity. More notably, futures market open interest increased by 11.18%, totaling $79.84 billion, indicating substantial funds are betting on Bitcoin's subsequent trend.
However, a phenomenon worth noting is retail investor participation.
According to CryptoQuant data, as Bitcoin approaches historical highs, retail investor trading volume (defined as wallets with transactions between $0-$10,000) accounts for only 3.2% of total volume, a stark contrast to 30% in December 2024. This difference might mean the current rise is primarily driven by institutional funds, with retail investors either holding or already exiting.
Polymarket contract data shows a 79% probability of Bitcoin breaking $110,000 before the end of May. The probability of reaching $115,000 and $125,000 by May-end are 37% and 5% respectively. The possibility of breaking $150,000 or $200,000 is currently estimated at around 1%, reflecting market caution about higher prices.
Digital Gold at a Crossroads
Facing such a complex market environment, Bitcoin seems to stand at a critical crossroads. On one hand, traditional financial market turbulence continues to drive funds into cryptocurrency; on the other, declining retail liquidity and pressure at key resistance levels bring uncertainty to the rise.
Renowned anonymous analyst apsk32, based on the "power law curve" model, believes Bitcoin might reach $200,000 in 2025. This prediction is partially supported by technical indicators, such as Bitcoin's Sharpe ratio recently aligning with gold. Jurrien Timmer, Fidelity's global macro director, even suggested investors could allocate assets in a 4:1 gold to Bitcoin ratio.
Historical data shows the second quarter has always been Bitcoin's "seasonal rise moment": Currently, this quarter's 28% increase has already placed it as the fifth-best performance since 2013, and if this rally continues into June, it will again validate this trend.
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