Bitcoin, the quintessential cryptocurrency, trembles on a precipice of unprecedented valuation, according to Willy Woo, an expert in on-chain analysis. Despite the pressure from sellers pushing the price into a sway, Woo is optimistic about its potential, crediting the advent of new Bitcoin exchange-traded funds (ETFs) as a fulcrum to propel Bitcoin into new financial heights. These colossal leaps could see Bitcoin skyrocket to a potential ceiling of $650,000 in a bullish market scenario or sink to as low as $91,000 during a bearish downturn.
The fruition of Woo’s exuberant projections relies on the decisions of leading asset managers. Should they opt to channel their recommended allocations into Bitcoin, the result would be an ostentatious influx into the world’s most esteemed digital asset, marking a significant turning point in Bitcoin’s journey.
Presently, Bitcoin remains in a state of financial limbo. Despite having reached an all-time high of over $73,000 in the middle of March 2024, it has since been beleaguered by unrelenting pressure. The range in which Bitcoin currently oscillates is capped at a stratospheric $73,800 on the upper limit and an approximate $61,000 on the lower end. Hence, as long as Bitcoin’s worth oscillates within this boundary, the trend towards an uptrend endures.
This uptrend, however, harks back to an earlier period in Q1 2024. Following the ratification of the first Bitcoin ETFs in the United States, the new financial landscape spurred Bitcoin into a new phase of development. Consequently, the potential ascensions to $91,000 and the staggering $650,000 valuation are not immediate prospects, but rather long-term objectives contingent on an assortment of elements.
Foremost among these elements is the alacrity with which stalwart asset managers like BlackRock incorporate Bitcoin into their diversified portfolios. Yet, these staggering projections do not account for an important event – the inflow from non-custodial wallets. The rise of the digital era and the proliferation of cryptocurrency enthusiasts could very well pump a greater inflow from these wallets, adding a new dimension to Bitcoin’s potential ascent.
So, how will Bitcoin skyrocket in the ensuing years? Woo estimates that global asset managers preside over approximately $100 trillion in assets. Even a modest 2% allocation (consistent with Fidelity’s recommendation) into Bitcoin would result in a $2 trillion infusion into the flagship cryptocurrency. Coupled with Bitcoin’s current valuation of approximately $561 billion from the on-chain activity, the cumulative investment could reach a gargantuan $2.56 trillion.
Further examining the situation through the lens of the Market Value to Realized Value (MVRV) ratio, a metric comparing market capitalization to on-chain investment, Woo suggests Bitcoin could conceivably ascend to a zenith of $650,000 in a bull cyclical market and reach a floor of $91,000 during a bearish descent. Woo’s projections set Bitcoin on a trajectory akin to gold’s 12-year bull-run, albeit influenced by the rising tide of crypto adoption and the advent of budding regulations in Europe and Asia. Ultimately, these myriad factors will dictate the future journey of Bitcoin – be it towards a gravity-defying $650,000 or a more modest $91,000.