As discussions about the establishment of a Bitcoin strategic reserve in the United States intensify, Bitwise’s Chief Investment Officer, Matt Hougan, has shared his perspective on the potential impact of such a move on the value of Bitcoin.
In an interview, Hougan suggested that if the US government does establish a Bitcoin reserve, the cryptocurrency could appreciate to as high as $500,000. This forecast comes amidst a backdrop of growing momentum for cryptocurrencies in the US, following the election of President Trump. The choice of cabinet members by the president-elect signals a likely commitment to fostering a conducive environment for the growth of cryptocurrencies.
The implementation of a Bitcoin reserve, according to Hougan, could be a significant game-changer for the asset. He contends that such a move would likely attract interest from other countries worldwide, leading to increased demand for the premiere cryptocurrency.
Hougan went further to predict the implications of such a development on Bitcoin’s price trajectory. He believes that the establishment of a Bitcoin reserve would push the asset past its current target of $200,000, potentially seeing it rip between $300,000 and $500,000 per Bitcoin.
Already, the prospect of a US Bitcoin reserve is stirring interest in other countries. Russia, Brazil, and the European Union are reportedly considering the idea of a Bitcoin strategic reserve. In Canada, the city of Vancouver recently passed a bill allowing it to hold Bitcoin.
Hougan also painted a positive picture of Bitcoin’s performance beyond 2024. He reiterated Bitwise’s prediction of a $200,000 price for Bitcoin, highlighting three factors that could drive this price surge.
Firstly, he noted that inflows from US Bitcoin spot exchange-traded funds (ETFs) have been a significant source of demand. These investment vehicles have cumulatively raked in $36.73 billion this year and currently hold 5.76% of Bitcoin’s circulating supply.
Secondly, Hougan pointed out that public companies are increasingly accumulating Bitcoin. Companies like MicroStrategy and Marathon Digital have been joined by newer entrants like Rumble and Metaplanet in adopting Bitcoin as a strategic reserve asset.
Lastly, he cited the growing demand for Bitcoin among nations. Hougan believes this massive inflow catalyst, coupled with Bitcoin’s limited supply, will trigger a demand shock, leading to a significant appreciation in Bitcoin’s value next year.
In conclusion, Hougan’s outlook suggests that even without the establishment of a US Bitcoin reserve, Bitcoin could trade at $200,000 by 2025. At the time of writing, Bitcoin is trading at $104,128, marking a 2.4% decline over the past 24 hours.
