Could this be a good time to invest in bitcoin?

Bitcoin [BTC] has had a rough few months.

It started 2025 on a high, buoyed by US President Donald Trump’s newfound crypto-enthusiasm.

However, over the course of the year BTC’s trajectory followed a familiar late-cycle pattern: early strength, a euphoric peak then a sharp unwind.

Momentum built through mid-year, with prices breaking above $110,000 and accelerating towards $118,000 by July as positioning became increasingly crowded.

The cycle peaked in October near $126,000, marking a classic blow-off top driven by leverage and bullish consensus.

Macro shocks triggered risk-off moves, exposing how sensitive BTC has become to global macro volatility and prompting a rapid correction, with BTC falling roughly 30% to the mid-$80,000 range. People began talking about a “crypto winter”.

Into year-end, the market stabilised but the price failed to regain much lost ground, closing just under $90,000, slightly down on the year.

Winds of change?

The doldrums spilled over into 2026.

Bitcoin hovered around $85,000 as market participants digested the late-2025 sell-off. January saw cautious accumulation, with institutional inflows steady but muted, suggesting that confidence was returning.

By February, a tentative recovery began to emerge. Spot ETFs and high-net-worth investors gradually added exposure, and broader risk sentiment improved alongside tech equities. However, prices dipped, with bitcoin trading in a narrow $65,000-72,000 range.

A palpable shift occurred in March, as Goldman Sachs analyst James Yaro recently highlighted. Two developments were key.

First, institutional investors began showing renewed interest. Following four months of net outflows, spot BTC ETFs saw $1.32bn in inflows during March, indicating potential support for a market rebound.

Second, BTC’s trading dynamics shifted. The number of liquidations – forced sales triggered when leveraged positions move against investors – began to decline in March. Such liquidations have historically suppressed BTC price, as automatic selling pressure can weigh heavily on the market. A reduction in these forced sales could remove a key drag, creating more favourable conditions for price recovery.

Some investors are seeing this as a good entry point for the cryptocurrency: its price is significantly below where it was last October, and the signs suggest it is on the rise.

However, there are a number of macro issues to bear in mind that could move the needle in unpredictable ways.

What happens if CLARITY passes? And if it doesn’t?

Probably the biggest talking point in the cryptosphere right now is the CLARITY Act, and specifically whether it will actually happen.

In an op-ed for the Wall Street Journal on 8 April, US Treasury Secretary Scott Bessent urged the Senate to pass the act.

“The regulatory framework for digital asset markets is unclear,” he wrote.

“This uncertainty had predictable consequences. A growing share of crypto development relocated to places with clear rules, such as Abu Dhabi and Singapore. Abroad, firms knew when and how to register, what standards to meet and how to operate. The benefits of domiciling in the US rarely outweighed the risks.”

Without CLARITY, these outflows may well continue, while the current lack of a clear regulatory framework could result in further volatility.

Indeed, on 17 March, Citigroup cut its 12-month price forecasts for BTC, principally as a result of slowing progress on CLARITY. The bank now expects BTC to reach $112,000, down significantly from its previous target of $143,000 but still reflecting a healthy chunk of upside from current levels.

If CLARITY passes, BTC could benefit from a surge in legitimacy and institutional participation. Clear regulatory guidelines would reduce uncertainty, encourage long-term investment, and make ETFs and custodial services more secure, potentially stabilising price swings and supporting renewed inflows. Confidence among high-net-worth investors and corporates could increase, dampening volatility and fostering wider adoption.

If it were to fail, uncertainty would persist, likely deterring institutional entrants and leaving retail investors exposed to sharper swings. Leverage-driven liquidations could remain common, and regulatory ambiguity might spur temporary sell-offs, keeping BTC in a risk-on, sentiment-sensitive trading regime rather than a maturing, structurally robust market.

The US Senate returns from Easter break on 13 April. The window to push through CLARITY ahead of the midterm elections is thus vanishingly small. By the end of April, at the latest, it will be clear if CLARITY is going to happen in its current form. If it does go ahead, a lot of bitcoin-watchers anticipate a spike in the price.

Ongoing macro uncertainty

Global markets are deeply affected by Middle East tensions, notably around the Iran-US conflict and the Strait of Hormuz, which disrupted energy flows and pushed volatility higher. This uncertainty has lifted crude prices at times, weakened the dollar on ceasefire headlines and buoyed risk sentiment when diplomatic progress emerges. BTC’s price has been reactive to these developments, trading in a wide range rather than on a clear trend and often moving with risk assets when macro sentiment shifts.

In summary, in the short term, BTC reacts sharply to geopolitical developments. When tensions ease or a ceasefire takes hold, the market often rebounds, producing swift snapback rallies as risk appetite returns. Conversely, ongoing or intensifying conflict tends to suppress sentiment, keeping BTC range‑bound or driving it lower, highlighting its role as a high‑beta risk asset rather than a traditional safe haven.

As with so much else, then, BTC price is hanging on the outcome of the course of the Iran conflict. Should other conflicts erupt, or the current conflict become more entrenched, that could seriously dampen the cryptocurrency’s prospects.

Conclusion

In short, bitcoin’s current lull could represent an opportunity, but only for those comfortable navigating uncertainty. Regulatory clarity, institutional inflows and easing geopolitical tensions could drive renewed momentum, while continued conflict or stalled legislation may keep prices range-bound. Investors should weigh potential upside against persistent macro and policy risks.