On December 19, financial news reported that Matt Hogen, Chief Investment Officer (CIO) of Bitwise, the largest cryptocurrency fund management company in the U.S., predicted that if the U.S. establishes a national Bitcoin reserve, Bitcoin's price could soar to $500,000.
This means Bitcoin is expected to rise nearly 400% from its current price. According to data from cryptocurrency news site Coindesk, Bitcoin's current price is $100,475.
After Federal Reserve Chairman Powell stated on Wednesday that the Fed does not intend to hold digital currencies and hinted at a more cautious approach to interest rate cuts next year, Bitcoin's price plummeted, dropping nearly 5% in the past 24 hours. Earlier this week, the cryptocurrency briefly hit a historic high of over $108,000.
Hogen stated that U.S. purchases of Bitcoin will drive more countries to buy cryptocurrencies.
“If we really establish a strategic Bitcoin reserve, with the government buying Bitcoin... a price of $200,000 for Bitcoin seems a bit conservative. You will see Bitcoin at $300,000, $400,000, and $500,000. This is a major event because governments around the world will do this (buy Bitcoin),” Hogen stated.
Hogen stated that he was skeptical when Trump first proposed the idea of establishing a national Bitcoin reserve during his campaign. However, he pointed out that this idea “has not disappeared,” and Wyoming Senator Cynthia Lummis recently introduced a new cryptocurrency bill. More people within the Trump administration have expressed an open attitude towards the idea of establishing a strategic Bitcoin reserve. Trump also hinted again at establishing a Bitcoin reserve during an interview at the New York Stock Exchange last week.
“I still think that, you know, maybe this (the possibility of establishing a national Bitcoin reserve) is less than 50%, but it’s not zero,” he added. “Once again, if that happens, or we start to see it happen in other countries, you will see Bitcoin soar, making the 2024 (increase) appear quite moderate in comparison.
Since the U.S. presidential election, Bitcoin has risen by 55%, and it has increased by more than 140% this year.
Setting aside the Bitcoin strategic reserve discussion, Hogen stated that with rising investor demand, Bitcoin is expected to climb to $200,000 in the next year.
He believes Bitcoin has three ‘unstoppable’ sources of demand, namely ETFs, Microstrategy (the publicly traded company with the largest Bitcoin holdings), and various governments that may become Bitcoin buyers.
“Ultimately, it comes down to supply and demand. With excessive demand and insufficient supply, I believe the price of Bitcoin will be higher in 2025,” he added.
As Trump’s second term approaches, Wall Street's optimism towards cryptocurrency is growing.
Standard Chartered, which accurately predicted that Bitcoin would rise to $100,000 this year, also forecasts that by the end of 2025, Bitcoin's price will reach $200,000, while some more daring bulls predict that Bitcoin will rise to $500,000. Cryptocurrency lobbyist and Digital Chamber CEO Perianne Boring even boldly declared that Bitcoin will break through $800,000 next year.