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Bitcoin Price to $650,000: Analyst Sees BTC Outperforming Gold in Long Term

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Mon, 15/04/2024 - 16:21
Bitcoin Price to $650,000: Analyst Sees BTC Outperforming Gold in Long Term
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In a bold forecast, Bitcoin analyst Willy Woo predicts that Bitcoin will outperform the gold market cap once ETFs have completed their role.

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According to Woo, the recently launched Bitcoin ETFs bring BTC price targets of $91,000 at the bear market bottom and $650,000 at the bull market top, which might happen once ETF investors have fully deployed capital according to asset manager recommendations.

While excitement remains on these bold price forecasts, Woo cautioned that these targets may not be achievable this cycle because capital deployments take a long time to complete. He outlines in six points what he regards as "back of the envelope calculations" in support of this prediction.

Woo bases his forecast on the premise that the $100 trillion being managed by asset managers generally has a 2% allocation recommendation. This yields an estimate of about  $2 trillion potential allocation into BTC, which he believes might rise over time.

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Woo further estimates that BTC currently holds $561,159,959 of investment, citing on-chain data; an inflow of $2 trillion would increase the amount to over $2.56 trillion.

Using MVRV to calculate market cap versus money invested, a ratio which is 5x in bull market tops and 0.7x in bear market bottoms, this translates to market capitalizations of $12.8 trillion and $1.8 trillion, respectively, translating to $650,000 and $91,000 for the BTC price in bull and bear market scenarios, respectively.

Excluding other self-custody inflows, Woo believes that Bitcoin might certainly exceed gold capitalization by the time the asset manager capital is deployed. Given that gold experienced a 12-year bull run after its ETF was approved, Bitcoin may follow suit.

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At the time of writing, BTC was up 0.49% in the last 24 hours to $64,524. According to Bloomberg, Bitcoin's dominance in the crypto market has reached a three-year high, reflecting strong demand for U.S. exchange-traded funds that hold the largest digital asset, as well as a challenging era for smaller tokens.

According to CoinMarketCap data, Bitcoin accounted for about 55% of the $2.4 trillion cryptocurrency market as of the end of last week, a level not seen since April 2021.

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