Bitcoin, Will It ‘Rise’ in Q3? 3 Macroeconomic Factors to Watch

As the second quarter of 2025 concludes, Bitcoin (BTC) has recorded its highest quarterly return since the second quarter of 2020. The expectation of Federal Reserve rate cuts and increasing M2 money supply raised optimism that this positive momentum could continue into the third quarter.

However, Bitcoin's upward trend may face obstacles such as potential trade war threats and the weight of historical market patterns.

Will Bitcoin Overcome the Downturn in the Third Quarter of 2025?

According to Coinglass data, Bitcoin experienced a decline at the beginning of the year but strongly rebounded in the second quarter. During the second quarter, BTC recorded a 29.79% return.

This was one of the best quarterly performances since Bitcoin increased by 42.33% in the second quarter of 2020.

Additionally, Bitcoin surpassed its all-time high (ATH) of $111,900 in May. This was triggered by favorable macroeconomic factors and increasing institutional adoption. While geopolitical tensions caused a correction that pulled Bitcoin below $100,000, Bitcoin maintained its resilience by recovering most of its losses.

According to BeInCrypto data, Bitcoin's trading price at the time of writing was $107,383, up 3% from the previous week. As the second quarter concludes, all eyes are now focused on how Bitcoin will perform in the next quarter.

Historically, the third quarter has been Bitcoin's weakest, with an average return of only 6.03%. Nevertheless, market observers have varying opinions about Bitcoin's potential performance.

In a recent X post, analyst Ether Wise emphasized that Bitcoin's spot trading volume is increasing. He noted that a similar pattern was observed in the third quarter of 2024, leading to a price increase.

"I think BTC's new ATH will be achieved within a few weeks." – Ether Wise, Analyst

In contrast, Benjamin Cowen, CEO of Into The Cryptoverse, predicted that Bitcoin might record its next bottom in August or September, presenting a more cautious outlook for the coming months.

"Bitcoin is likely to show some weakness as the third quarter's weakness begins to appear around mid-June. The same thing has happened in the past few years." – Benjamin Cowen, CEO of Into The Cryptoverse

Three Macroeconomic Factors That Will Determine Bitcoin's Third Quarter Fate

With Bitcoin's outlook being debatable, several upcoming macroeconomic events and factors could influence Bitcoin's path in the third quarter of 2025. The first major event is the expected Federal Reserve rate cut.

According to CME FedWatch data, only 20.7% of market participants expect the Federal Reserve to cut rates in July, but this probability rises to 90.3% in September.

This dramatic shift in expectations reflects confidence that the Fed will ease monetary policy in the third quarter, which could be a significant upward factor for the cryptocurrency market, including Bitcoin.

Additionally, M2 money supply is expected to continue increasing in the third quarter. According to analyst Cas Abbe, the People's Bank of China injected 1.5 trillion yuan into the economy this week through reverse repo operations.

These moves, part of a broader effort to stimulate economic growth, could increase market liquidity. This could promote demand for assets like Bitcoin, as investors seek alternatives within an expanding monetary supply.

"The biggest reason is the DXY decline. This gives other countries the freedom to issue more without worrying about currency devaluation. All of this is pushing global M2 supply to new highs, which means Bitcoin's rise will be even greater. Bitcoin will reach $130,000 to $140,000 in the third quarter." – Abbe added.

Meanwhile, increasing US debt positions Bitcoin as an attractive hedge, potentially drawing institutional and individual interest as investors seek alternatives to traditional assets.

However, the expiration of Trump's 90-day tariff exemption approaches as a significant counterforce.

"President Trump's 90-day tariff grace period now has only 13 days left. If no new trade agreement is reached, tariff rates will rise as follows on July 9th: 1. 'Reciprocal tariffs' by country will return, 2. Up to 50% tariffs will be imposed on EU imports, 3. 30% tariffs on Chinese imports will continue to be applied, 4. Global 10% base tariff will continue to be applied." – Kobeissi Letter posted.

The potential restart of the trade war could cause volatility. Historically, it has been a challenge for Bit. Past trade tensions have led to sharp price adjustments. Therefore, if trade war stories resume in the third quarter, they could weaken the positive effects of interest rate cuts and monetary supply increases.