The Future of Bitcoin and Altcoins: Insights from CK Zheng
According to CK Zheng, the founder of the crypto hedge fund ZX Squared Capital, Bitcoin could potentially reach $125,000 by the year’s end. However, he predicts that other cryptocurrencies may outperform Bitcoin in this period. In a recent interview with CoinDesk, Zheng emphasized, “There’s a correlation between Bitcoin and altcoins, but I believe Bitcoin dominance is set to decline.” He elaborated on the importance of a thriving crypto ecosystem, stating, “You can’t have 60% of the market’s value trapped in Bitcoin if you want the sector to truly develop.”
The shift in sentiment towards cryptocurrencies is being driven in part by the current administration’s more favorable stance compared to its predecessor. The Trump administration is reportedly exploring the creation of a national crypto reserve. Additionally, the Securities and Exchange Commission (SEC) has begun to withdraw lawsuits against various crypto companies and protocols, including Kraken and Uniswap. Zheng noted, “New policies and regulations are on the horizon, which will spark a wave of innovation and disrupt the crypto landscape.” He anticipates that these changes might take some time to fully materialize, likely extending into 2025 and 2026.
Among the cryptocurrencies poised to benefit from this potential new wave of innovation are Ether (ETH) and Solana (SOL). Zheng specifically mentioned the exciting opportunities that could arise if projects that merge artificial intelligence (AI) with cryptocurrency gain traction. He pointed out the necessity for these smart contract blockchains to enhance their throughput to remain competitive—Solana must continue to grow its capabilities, while Ethereum needs to reclaim its leading position.
In the short term, Bitcoin is expected to continue behaving like a risk-on asset, experiencing fluctuations in line with other risk assets as the Trump administration introduces new economic policies. Zheng remarked that macroeconomic factors will largely influence Bitcoin’s price trajectory unless the U.S. government takes decisive action regarding the proposed national crypto reserve. This pivotal moment could occur at the upcoming White House Crypto Summit scheduled for this Friday.
Commerce Secretary Howard Lutnick commented on the administration’s interest in a Bitcoin strategic reserve, stating, “The President has shown a keen interest in this topic throughout his campaign, and I anticipate we will see concrete actions on Friday.” He further clarified, “While Bitcoin is one aspect, other cryptocurrencies and tokens will be approached positively, but in a different manner.”
Despite the potential implementation of tariffs against Mexico, Canada, and China, Zheng does not foresee Bitcoin dropping below the $75,000 threshold. “In the near term, market conditions may be quite volatile,” he explained. “However, this presents a valuable opportunity for long-term investors who have been patiently waiting to allocate funds into Bitcoin.”
