Bitcoin’s value is poised to soar beyond $1 million within the next decade, reaching $500,000 by 2029, according to a recent report from AllianceBernstein. The report also forecasts that Bitcoin will hit $200,000 within the next year, a substantial increase from its recent modest prices.
Despite a recent dip in Bitcoin’s value, market analysts anticipate sustained growth over the coming year. The AllianceBernstein report highlights Bitcoin’s potential, stating, “Bitcoin, as a younger asset, has more room to grow as it gains adoption within asset allocation portfolios.”
The launch of spot Bitcoin exchange-traded funds (ETFs) in January has seen 11 new investment vehicles collectively managing around $55 billion in assets. This figure is modest compared to the $210 billion managed by gold ETFs. AllianceBernstein pointed out that Bitcoin ETFs currently account for only 0.16% of addressable asset pools.
Retail investors contribute to over two-thirds of ETF inflows today, but AllianceBernstein predicts that institutional adoption of Bitcoin ETFs is imminent from wealth platforms, registered investment advisers, and wirehouses.
AllianceBernstein emphasized the supply and demand dynamics of Bitcoin, particularly in light of the quadrennial Bitcoin halving. The most recent halving in April reduced miners’ rewards from 6.25 to 3.125 Bitcoin, affecting their profitability.
The May 2020 halving saw increased corporate interest from firms like MicroStrategy, Grayscale, and Tesla, which led to a significant price surge for Bitcoin. AllianceBernstein noted that significant price increases are typically driven by factors such as sell pressure following the halving and reduced Bitcoin supply from HODL investors, who tend to hold onto Bitcoin despite price fluctuations.
This combination of factors suggests a promising future for Bitcoin, with expectations of substantial growth in value over the next decade.
Related Topics:
