Cathie Wood is the founder of ARK Invest, the 11th largest U.S exchange traded fund (ETF) publisher with $45 billion in assets under management. She has great expectations of the bitcoin (BTC) price. She expects bitcoin to eventually reach a price of $500,000. But how did she arrive at this price? At the CFA Societies Australian Investment Conference she explains this.
Within the crypto world, bitcoin price expectations are pouring in like hot cakes. Wood is one of the leading figures in this world who sees a bitcoin price above $100,000 happen. She expressed her bitcoin price forecast of $500,000 several times, including last month.
Other people who have such price expectations are Bloomberg analyst Mike McGlone, who expects a price of $100,000, and Dutch analyst PlanB, who sees bitcoin soar to $100,000 this year. Woods expectation is a lot higher, but it is for the longer term. During a conference, she explains that price increases will mainly result from the development of large institutional investors including bitcoin in their portfolio. She has seen that happen twice in her life with other asset classes:
“I have experienced two periods in my investment life where new asset classes were introduced into institutional portfolios. Real Estate in the 1970s and 1980s and Emerging Markets,”
And how does she get to $500,000? Wood explains:
“If institutions around the world were to allocate 5 percent of their wallets to bitcoin, that allocation alone, and this is just one of many use cases out there, would add about $500,000 to the price of bitcoin.”
One of the developments that could trigger another boost for bitcoin this year is the approval of a bitcoin ETF, a stock exchange fund that allows investors to easily invest in BTC. Some expect another one to be approved this year, while others are less optimistic.