Crypto News – Ark Invest has forecast that if institutions commit a significant amount of their investable asset base to Bitcoin (BTC), the price of BTC might surge to $2.3 million.
Ark Invest Bitcoin Forecast: Data in Report Shows BTC Could Rise as High as $2.3 Million
The forecast was published by the asset manager in its Big Ideas 2024 research report. The company outlines the potential effects on the price of bitcoin that institutional allocations and investments from the $250 trillion global investable asset base might have.
As per the research conducted by Ark Invest, a portfolio that aimed to optimize risk-adjusted returns over a five-year period starting in 2015 would have allocated 0.5% towards Bitcoin. Since then, based on the same criteria, the average allocation to digital assets would have been 4.8%, compared to 19.4% for these portfolios in 2023 alone.
Bitcoin Volatility Could Hinder Returns
The estimate suggests BTC might reach $120,000 with a 1% allocation from the $250 trillion global base of investable assets. Bitcoin might rise to $550,000 if a maximum Sharpe ratio of 4.8% is allocated between 2015 and 2023. After the 19.4% allocation in 2023, the asset can soar to $2.3 million.
Bitcoin’s volatility can obfuscate its long-term returns. While significant appreciation or depreciation can occur over the short term, a long term investment horizon has been key to investing in bitcoin. Instead of “when,” the better question is, “For how long?” Historically, investors who bought and held bitcoin for at least 5 years have profited, no matter when they made their purchases,
the asset manager
Leave a comment