As the end of the year approaches, one of the biggest concerns for Bitcoin investors is whether this year's Christmas rally will arrive as expected.
The so-called "Christmas rally" typically refers to the seasonal price increase that occurs from late December (around Christmas) to early January. This concept has a long history in the traditional U.S. stock market, but in recent years, as Bitcoin has become increasingly correlated with global risk assets, the crypto community has also begun to pay attention to and adopt this term—hoping for a "Christmas bonus" at the end of the year.
However, history tells us that Bitcoin's Christmas rally has never been a certainty.
1. Historical Review of Bitcoin's Christmas Rally: The Probability of Increase is Not Dominant, but Bull Market Years Often Shine Brightly
We have compiled the performance of BTC over the past seven complete Christmas-New Year cycles (roughly from December 24 to January 3-5 of the following year):
- 2024 (2024.12.24 → 2025.01.03): +3.67% (slight increase)
- 2023 (2023.12.22 → 2024.01.03): -2.33% (slight decrease)
- 2022 (2022.12.26 → 2023.01.03): +0.08% (basically flat)
- 2021 (2021.12.27 → 2022.01.04): -10.4% (significant decrease)
- 2020 (2020.12.24 → 2021.01.05): +46.15% (super surge)
- 2019 (2019.12.24 → 2020.01.03): +0.55% (slight increase)
- 2018 (2018.12.24 → 2019.01.03): -6.03% (slight decrease)
(Chart: AiCoin PC multi-window feature allows for multiple charts to be displayed simultaneously)
Data Summary:
- In 7 years, there were 4 increases (about 57%) and 3 decreases.
- The average change was about +4.5%, but this positive return was almost entirely contributed by the super bull market of 2020.
- Strong performance is often seen in bull markets or during the continuation phase after halving (like in 2020 and 2024), which may even lead to explosive increases.
- In the late stages of bear markets or during bull market top adjustments (like in 2018, 2021, and 2023), declines are more likely to occur.
In simple terms, Bitcoin's Christmas rally is highly dependent on the broader cyclical context and is not merely a "seasonal curse."
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2. Why Do Prices Sometimes Rise at Year-End? Several Common Explanations
Although there are no absolute rules, market participants have provided several explanations for the phenomenon of potential year-end increases, which can be referenced:
- Institutional "Window Dressing": At year-end, institutions need to present impressive performance reports and tend to increase their holdings of strong-performing assets (like Bitcoin in a bull market) or rebuild positions at lower levels, driving prices up.
- Tax Factors and Fund Reallocation: Some investors may sell losing positions at year-end to realize tax losses, then reinvest the funds into favored assets. Bitcoin, as a high-risk, high-reward asset, often becomes a target.
- Holiday Liquidity Effect: During the period from Christmas to New Year, trading volume usually shrinks significantly, reducing sell pressure, and a small amount of buying can push prices higher; combined with optimistic retail sentiment, this can easily lead to self-reinforcing increases.
- Bonuses and Incremental Funds: Year-end bonuses and holiday optimism may also bring marginal buying.
Conversely, when the market is in a state of fear or adjustment, low liquidity can amplify declines—Christmas pullbacks in 2018 and 2021 are typical examples.
3. Current Position: Will There Be a Christmas Rally in 2025?
As of December 17, 2025, Bitcoin's price has been fluctuating in the $86,000-$88,000 range, having previously reached a high of $126,000 before a noticeable pullback. With just over a week until Christmas, market liquidity has begun to decline, and volatility is likely to be amplified.
Positive Factors:
- The 2024 Christmas cycle just achieved a +3.67% increase, breaking the weak trend of previous years.
- Benefits from interest rate cuts.
- Institutional year-end position adjustments and continuous ETF inflows may bring incremental funds.
Risk Points:
- Current valuations remain high, and some investors are concerned about profit-taking pressure at the end of the bull market.
- Macroeconomic uncertainties (inflation rebound, geopolitical issues, policy shifts) could exacerbate pullbacks if they exceed expectations in a low liquidity environment.
- Although the VIX is at a low level (17.04), low volatility often represents the calm before the storm.
4. Conclusion: No Certainties, Only Probabilities and Cycles
Bitcoin's Christmas rally has never been a fairy tale of "always rising every year," but rather a probability game that heavily relies on the current bull-bear cycle.
In a bull market, it may turn into a generous "Christmas gift"; in a bear market or adjustment period, it may just be ordinary holiday fluctuations.
For this wave at the end of 2025, we cannot provide a definite answer, but historical experience tells us: maintaining rationality, controlling positions, and paying attention to broader cyclical signals is more important than blindly expecting "Santa Claus."
True long-term returns come from respecting trends. Wishing everyone a Merry Christmas and successful investments—whether or not there is a Christmas rally, the long slope of the bull market remains beneath our feet.
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