A price of $500,000 would mean that Bitcoin has entered the maturity phase, until then the first cryptocurrency will remain in the “early stage”, according to Bitwise CIO Matt Hougan.
“In my opinion, $500,000 per coin is the right boundary between the early and late stages for a very simple reason: this is the point at which Bitcoin will become ‘mature’,” the expert noted.
Hougan emphasized that investing in the first cryptocurrency now is a bet on two outcomes at once:
the demand for savings assets will grow;
Bitcoin will be increasingly perceived as a store of value and will eventually become on par with gold.
On the first point, he noted that governments around the world continue to accumulate debt and devalue their currencies, increasing demand for gold and, potentially, cryptocurrency.
The second bet, according to the investment expert, remains in question. Until Bitcoin catches up with gold and becomes a familiar asset for central banks and institutional investors, the “early stage” will continue.
"No one is embarrassed when institutions allocate funds to gold or when central banks invest billions from their balance sheets. You don't read tons of skeptical stories in the media about gold or see sitting US senators raising armies against gold. Gold 'did it,'" Hougan wrote.
According to his estimates, the capitalization of the savings asset market is about $20 trillion. Of this, $18 trillion is the gold figure, and about $2 trillion is Bitcoin. In its "mature" form, the first cryptocurrency should at least split this market in half with the precious metal.
Given the maximum possible supply of 21 million BTC, this balance can be achieved at a price of $500,000. To achieve this, Hougan says, central banks must start investing in cryptocurrency on par with gold.
"Today, governments own about 20% of the world's gold reserves, compared to less than 2% of all bitcoins. For bitcoin to get closer to $500,000, we need to close that gap," the expert concluded.
BlackRock CEO Larry Fink believes that the first cryptocurrency is already a worthy alternative to conventional investments in commodities, including gold, and this adoption will only expand. He compared the current dynamics of bitcoin to the early period of the mortgage lending market, which reached a capitalization of $ 11 trillion.
Earlier, former head of BitMEX Arthur Hayes said that Donald Trump's policies could lead to a collapse of the dollar and push Bitcoin to $1 million.
Recall that at the end of October, Hougan admitted that Bitcoin could grow to $200,000 even without the collapse of the American monetary system.
