Bitcoin (BTCUSD)

[ap17]

From nutshell:

FIVE BITCOIN PREDICTIONS 🤑
Bitcoin will hit $250,000 this cycle.

That’s one of the latest predictions out from Matt Hougan.

Matt Hougan
Matt Hougan is the Chief Investment Officer at Bitwise, the 4th largest Bitcoin ETF issuer.

Yesterday, Hougan gave 5 Bitcoin predictions on things we’ll see by the next halving. (2028)

Let’s break them down.

1) Bitcoin’s Volatility Will Decline 50%

Bitcoin’s volatility has been declining for years.

However, Matt believes the introduction of the ETFs will reduce volatility even more:

“On average, institutional investors are more likely than retail investors to rebalance their portfolios (selling high, buying low) and to make steady drip investments into the market (monthly, quarterly, etc.)”


Matt Hougan
This means we’ll likely see shallower drawdowns, but also slower price rallies going forward.

2) 5% Allocations to Bitcoin Will Become Common in Target-Date Portfolios

Decreased volatility makes Bitcoin a more attractive asset to institutional investors:

“As a result, I suspect we’ll see the “typical” portfolio allocation rise to the point where it is considered normal to have 5% or more of your portfolio in bitcoin.”


Matt Hougan
Today, typical allocations are between 1 - 3%.

3) Bitcoin ETFs Will Gather $200+ Billion in Flows

The Bitcoin ETFs have currently pulled in ~$12.5 billion in net flows since launch.

But Matt believes they’re only just getting started.

As it stands, they still aren’t fully available at wirehouses like Morgan Stanley. And major institutions are only just beginning their due diligence.

“ETF history also supports the view that flows are just beginning. Net flows into gold ETFs rose year after year for seven straight years after the first one debuted in the U.S. in 2004. Watch for something similar in bitcoin ETFs.”


Matt Hougan
4) Central Banks Will Begin Allocating to Bitcoin

Central banks hold roughly 20% of all the gold that’s ever been mined.

Matt explains that Bitcoin is essentially a modernised digital (better) version of gold.

With this in mind, before the next halving, Matt expects a central bank to adopt Bitcoin as a reserve asset.

“Those characteristics are increasingly attractive to governments in our increasingly fractious, multi-polar world, where countries like the U.S. are increasingly using financial tools as levers for foreign policy.”


Matt Hougan
5) Bitcoin’s Price Will Trade Above $250k

With the ETFs continuing to gather assets and major Wall Street firms joining the game, Matt believes Bitcoin will continue to move further into the mainstream.

“At $250,000, bitcoin would be a $5 trillion asset. Could it go higher? Of course. But $250,000 would represent solid progress between halvings, and I think we’ll see at least that.”


Matt Hougan
All five of Matt’s predictions sound fairly reasonable. Nothing too extreme.

But remember…

These are only predictions, not guarantees.

Although…

It is fun to think about where Bitcoin could end up in the next 4 years. 🤔