The price of Bitcoin could be headed a lot higher as more companies make Bitcoin a substantial part of their portfolios, according to a report by ARK Invest.
In it’s annual Big Ideas report, ARK said Bitcoin’s price could be headed for a run that could see it gain by $40,000 if “all S&P 500 companies were to allocate 1% of their cash” to BTC. The chances of all S&P 500 companies investing in BTC is unrealistic at this point though more and more institutions continue to pour into BTC.
Bitcoin gaining more trust among investors
According to the report; “Based on search volumes compared to 2017, bitcoin’s price increase seems to be driven less by hype. With bitcoin appearing to gain more trust, some companies are considering it as cash on their balance sheets.”
A $40,000 gain would put the BTC price in the vicinity of $73,000.The ARK report went on to point out that if S&P 500 companies were to allocate 10% of their cash to BTC, the price of the asset could see an astronomical rally of up to $400,000. BTC started out as a market place that was mostly dominated by enthusiastic and dreamy crypto enthusiasts.
The bubble of 2017 was also mainly caused by retail investors making lots of FOMO purchases. The recent rally had a big institutional hand behind it and a huge chunk of buyers are not letting go of their BTC. Industry data shows that more than 60% of Bitcoin’s circulating supply hasn’t moved in a year. The fact that a solid number of traders are not shorting their Bitcoin’s speaks of the conviction of the buyers.
Companies like MicroStrategy may not be part of the S&P 500 companies, but the firm leads corporate America in crypto investment. The data analytics firm has accumulated almost 71,000 BTC. As it stands, now, there is still a long distance to go as far as institutional adoption is concerned. At the time of writing, BTC has reclaimed its $40,000 spot and could be headed for a decent rally.
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