Bitwise Chief Investment Officer (CIO) Matt Hougan has predicted that the primary crypto-asset could go as high as $200,000 without the dollar collapsing.
Matt Hougan explained that Bitcoin draws its intrinsic value from two independent forces. Bitcoin’s role as a digital store of value and inflationary pressure on Fiat currencies.
He argued that most analysts neglect Bitcoin’s broader potential while assuming that the growth of the asset depends on a weakening dollar.
Hougan argued that the first driving force of Bitcoin’s relentless growth is the asset’s position as a digital equivalent to gold. Despite Bitcoin representing only 7% of gold’s estimated $18 trillion market, the Bitcoin market cap has the potential to grow as the adoption of the asset deepens amongst investors.
The Bitwise CIO stated that Bitcoin’s price could rise even if it captured just 25% of gold’s market pushing it well past $200,000.
The second driving force behind Bitcoins expansive growth according to Hougan stems from the possible debasement of fiat currencies, particularly the dollar, which could drive more investors toward assets like Bitcoin as a hedge. Assets like Bitcoin are increasingly seen as a hedge against inflation.
With the US federal debt sitting at $36 trillion, Matt Hougan sees growing fiscal pressures forcing investors to seek an alternative store of values benefitting assets like Bitcoin.
Matt Hougan further explained his theory with an X thread relaying a conversation he had with a financial advisor as regards the subject topic.
“ 1/ A financial advisor asked me a great question over dinner last week: Does the U.S. dollar need to collapse for bitcoin to hit $200,000? The answer is “no.” Here’s why…
2/ When you invest in Bitcoin, you’re making two bets at once: i) Bitcoin will succeed in establishing itself as a new “store of value” asset ii) Governments will abuse fiat currencies and increase demand for “store of value” assets.
3/ The two arguments are separate. Argument 1: Bitcoin is ~7% of gold’s $18tr market cap today. If it “matures” and becomes 50% the size of gold, every bitcoin is worth >$400k. Argument 2: The “store of value” market is growing because governments are abusing their currencies.
4/ Importantly, these arguments compound. If bitcoin matures and the store of value market doubles, you quickly get to seven figures. FWIW, I think this is the most likely scenario eventually.
5/ So, no, the dollar doesn’t need to collapse for bitcoin to hit $200k. All you need is Bitcoin to continue on its current path of maturing as an institutional asset. But it’s increasingly looking like both parts of the argument will come true. That’s why Bitcoin is surging toward all-time highs “Matt Hougan tweeted
Matt Horgan’s fundamental analysis of Bitcoin’s Price surge is not the only prediction models supporting the intrinsic growth of Bitcoin over time.
Andrey Ignatenko’s Math Bitcoin price prediction predicts the growth of Bitcoin using Mathematics as the key methodology.
Andrey Ignatenko’s Math Bitcoin price Predicts the price of Bitcoin up to 2030,2040 and 2050 with Bitcoin predicted to hit six figures before the year 2030.
Bitwise, Matt Hougan’s parent company is one of the asset managers that invested in Bitcoin and Ethereum ETFs in the United States. Other asset managers include Blackrock, Fidelity and Grayscale.