Bitcoin (BTC) hit a new all-time high earlier this week, trading above the $106,000 level in a historic rally.
Matt Hougan, CIO of Bitwise Asset Management, stated that this price action is the beginning of a phenomenal rally that could see Bitcoin reach $200,000 by 2025 and much higher under certain conditions.
Hougan said that Bitcoin’s continued rise is based on three main factors: the demand for large amounts of Bitcoin from exchange-traded funds (ETFs), the increasing presence of public companies like MicroStrategy, and finally, the potential interest of governments in Bitcoin. Hougan made the following statement regarding this situation: “It all comes down to supply and demand. Demand is very high and supply is limited, so I think Bitcoin prices will increase even more in 2025.”
According to Hougan, one potential catalyst is the idea of the US government creating a Bitcoin strategic reserve. This is a proposal supported by some members of the Trump administration and introduced as a bill by Senator Cynthia Lummis. The concept would see the government purchase up to one million Bitcoins. Hougan noted that such a move could push Bitcoin’s price predictions much higher:
“If the government starts buying Bitcoin, $200,000 Bitcoin is no longer low. We’re talking about $300,000, $400,000 or even $500,000.” Hougan acknowledged that the probability of this strategic reserve proposal coming true is still less than 50%, but stressed that the proposal is still on the agenda. He also said that such a move could have a global domino effect, forcing other countries to take similar steps, significantly increasing the value of Bitcoin.
Hougan remains optimistic about Bitcoin’s future, noting that increasing institutional adoption and new public market opportunities will also help Bitcoin’s value rise. He said that there has already been significant growth for 2024, but the real excitement could come in the near future:
“If governments or large-scale corporate companies start investing in Bitcoin, 2024 could be a calmer year. I think these developments will be much faster in the coming years.”