Bitwise Chief Investment Officer Matt Hougan predicts that Bitcoin (BTC) will surge past $80,000 this year, attributing this projection to the recent surge in exchange-traded funds (ETFs). The approval of Bitcoin ETFs has broken records and prompted a significant inflow of funds into the cryptocurrency since mid-January. In a recent interview, Hougan emphasized the sustained demand for ETFs, surpassing his initial expectations. He likened this surge in interest from traditional finance to Bitcoin’s IPO in the US market, foreseeing a subsequent increase in institutional investment and price appreciation. Hougan remarked, “Think of the ETF launch as Bitcoin’s IPO in the U.S. market. It has just unleashed a huge wave of interest from traditional finance, and it has exceeded my expectations.”
Bitwise’s ETF Sees Increased Inflows
Bitwise has notably achieved remarkable success within the ETF market. Within a single day, the company garnered approximately $126.5 million in inflows, marking its second-largest intake since its inception. Furthermore, it has crossed the milestone of $1 billion in assets under management, positioning itself alongside industry giants like BlackRock, Fidelity, and Ark Invest’s 21Shares.
However, despite the widespread availability of ETFs, not all financial institutions have embraced them. Thus far, retail investors have been the primary participants in trading, while banks and wirehouses are still undergoing thorough due diligence before offering ETFs to their clients.
Nonetheless, analysts anticipate that the growing demand from institutions will lead to a supply shortage and subsequent price escalation.
Spot Inflows and Halving to Drive BTC toward $80,000
According to Bitwise’s research, Bitcoin is anticipated to surpass the $80,000 mark, propelled by increased inflows into spot ETFs and the approaching Bitcoin halving.
The halving, occurring roughly every four years, will diminish the rewards for Bitcoin miners, thus constraining the influx of new Bitcoin into the market.
While the optimistic projection for Bitcoin’s price hinges on sustained institutional interest, there are potential hurdles to consider.
Regulatory ambiguities surrounding cryptocurrencies, especially against the backdrop of the upcoming US presidential election, contribute to an atmosphere of uncertainty.
Furthermore, the presence of undiscovered reservoirs of Bitcoin, held by governments or entangled in legal disputes, could exert supply pressures that might temporarily impede price appreciation.
Hougan acknowledged these risks but maintains an optimistic outlook on Bitcoin’s adoption, facilitated by the accessibility of ETFs.
The heightened interest from Wall Street signifies a notable shift that is expected to endure, indicating a promising trajectory for Bitcoin within the traditional financial landscape.
As reported, gold ETFs have encountered significant outflows this year, while ETFs tracking Bitcoin’s spot price have witnessed robust inflows.
Among the leading 14 gold ETFs, outflows amount to $2.4 billion as of February 14, 2024.
Only three of these gold ETFs have experienced minor inflows this year: VanEck Merk Gold Shares, FT Vest Gold Strategy Target Income ETF, and Proshares UltraShort Gold.
In contrast, preliminary data from Farside indicates that the ten approved spot Bitcoin ETFs have attracted aggregate inflows of approximately $4 billion this year, marking record-breaking volumes.
