US Strategic Bitcoin Reserve Could Push Price To $500,000: Expert
19 December 2024 - 2:00AM
NEWSBTC
In an exclusive interview with Yahoo Finance, Matt Hougan, Chief
Investment Officer at Bitwise Asset Management, shared his bullish
outlook on Bitcoin, projecting significant price appreciation by
the end of 2025. “We expect Bitcoin to be up above $200,000 by this
time next year,” Hougan stated, attributing this forecast to three
primary sources of demand: exchange-traded funds (ETFs), corporate
investments, and governmental acquisitions. Hougan elaborated,
“There are ETFs that are vacuuming up Bitcoin, public companies
like MicroStrategy are accumulating Bitcoin, and now we’re seeing
discussions about governments investing in Bitcoin. It ultimately
boils down to supply and demand—there’s too much demand and not
enough supply, which drives the price higher.” When probed about
the sustainability of such demand, Hougan emphasized the gradual
awakening of different investor segments to Bitcoin’s value
proposition. “People just wake up to Bitcoin at different paces.
We’ve seen retail investors engage first, followed by companies and
financial advisors, and now institutions are recognizing that
Bitcoin belongs in a diversified portfolio,” he explained. Related
Reading: Bitcoin Top Here? What Historical HODLer Selloff Pattern
Says “Bitcoin is now a global macro asset worth a few trillion
dollars, and virtually every investor should have some exposure. We
still have a large number of investors to go, which is why I
believe we’re still early in this journey. We have many quarters to
go,” he added. How High Can Price Go If The US Buys Bitcoin? A
pivotal aspect of Hougan’s forecast hinges on the potential
establishment of a US Strategic Bitcoin Reserve (SBR). Addressing
this, Hougan remarked, “If we do get a Bitcoin strategic reserve
where the government is buying Bitcoin, as proposed in Senator
Lummis’ bill for the government to purchase a million Bitcoin,
$200,000 Bitcoin is going to be looking quaint. You’re going to be
looking at three four $500,000 Bitcoin. It’s just too big a story
because governments all around the world would have to do it.”
Hougan admitted that he was first skeptical about Trump suggestions
to establish a SBR. “But over the months, it hasn’t gone away in
fact we continue to see leaders in the Trump Administration suggest
that they’re open to it,” Hougan remarked. The Bitcoin CIO still
thinks that the odds of the US government buying Bitcoin is less
than 50%, but “it’s not zero,” he added. “If it happens or if we
start to see it happening in other countries, you’re going to see a
rip up in Bitcoin that will make 2024 look pretty docel in
comparison.” Related Reading: Bitcoin Miners Now In Selling Mode
For A Year: Should You Be Concerned? Hougan also highlighted the
role of institutional platforms, specifically citing Coinbase as a
potential major beneficiary in the evolving crypto landscape.
“Coinbase is currently about half the size of Charles Schwab, and
we believe it could surpass Schwab in brokerage size,” he noted.
“Coinbase hasn’t had major competitors bubbling up to challenge it;
it’s sort of had a degree of regulatory capture, if you can believe
it. As a result, it’s been able to sustain its high margins in
brokerages and then layer on things like stablecoins. [..,.] It’ll
also help if it gets into the S&P 500; you see institutions
buying it broadly. I think it’s a really unique situation driven by
the fact that there was so much regulatory uncertainty—it cleared
the competitive fat path and now it’s going to reap those rewards
and build a really, you know, maybe an unsalable position leading
this industry in the US.” Looking ahead to the broader market,
Hougan anticipated an influx of crypto-related companies entering
public markets. “We can expect firms like Kraken, Anchorage, and
Chainalysis to go public, further normalizing the industry,” he
stated. “This influx will lead to increased Wall Street coverage
and institutional investment, setting the stage for a robust IPO
window in 2025.” Despite the optimistic outlook, Hougan
acknowledged potential risks that could impede Bitcoin’s growth.
“The biggest risk is that politicians don’t deliver on their
promises—if we don’t achieve regulatory clarity or fail to
establish a strategic reserve, the expected bull market might not
materialize,” he cautioned. “Regulatory and political factors are
crucial drivers for crypto in 2025, and any setbacks in these areas
could pose significant challenges.” At press time, Bitcoin traded
at $104,212. Featured image created with DALL.E, chart from
TradingView.com
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