Bitwise Chief Information Officer (CIO) Matt Hougan recently shared five interesting predictions for the upcoming bitcoin (btc) network halving, scheduled for 2028. In a comprehensive report, Hougan sheds light on the potential transformations of the leading cryptocurrency in the world.
New investors and ETFs as catalysts
One of Hougan's keys predictions is that bitcoin's volatility will decrease significantly by 50%. He maintains that the entry of new investors through the bitcoin spot Investment fund (ETF) will drive this decline.
Hougan said that as financial advisors, family offices and institutions enter the bitcoin market, their different investment behaviors (such as portfolio rebalancing and steady drip investments) could introduce countercyclical flows, ultimately will dampen bitcoin's volatility.
Hougan's second prediction revolves around the allocation of bitcoin into portfolios. He believes that 5% allocations to bitcoin will become commonplace in target-date portfolios. Like btc volatility declines and becomes more attractive to institutional investors, Hougan expects an increase in typical portfolio allocations.
Bitwise CIO Predicts bitcoin ETFs Will Attract Over $200 Billion in Inflows. It highlights its impressive growth and cites its status as the fastest-growing startup. ETF category of all times.
Hougan suggests that the ETF market is still in its early stages, and that national institutions and brokers are just beginning their due diligence. Drawing a parallel to the rise of gold ETFs, which saw year-over-year growth in net flows, he anticipates a similar trend for bitcoin ETFs.
bitcoin price heading towards $250,000
In an intriguing projection, Hougan suggests that central banks will allocate funds to bitcoin before the next halving event. He notes that central banks have historically been major investors in gold, accumulating substantial amounts of the metal.
However, with the characteristics of bitcoin as non-debt money and its functional advantages More than gold in terms of payments and settlements, Hougan believes that central banks will be increasingly attracted to bitcoin. Hougan further noted on this matter:
There is also an element of game theory here. A major central bank adopting bitcoin as a reserve asset would be a game-changer for bitcoin and, in my opinion, contribute to a dramatic rise in prices. Will a central bank try to get ahead of the others?
Hougan's final prediction revolves around the price of bitcoin. He predicts that bitcoin will trade above $250,000 by 2028, an increase of almost 280% from current levels.
Bitwise's CIO attributes bitcoin's previous exponential growth to its transition from a speculative asset to one with real-world utility.
Factors such as decreased volatility, improved custody options, low correlations with traditional stocks, increased accessibility through ETFs, and growing institutional adoption all contribute to Hougan's optimism regarding bitcoin's future progress. Hougan concluded by stating:
With ETFs launching and gathering assets (and major Wall Street firms lining up behind bitcoin), I suspect the asset will continue to move into the mainstream. At $250,000, bitcoin would be a $5 trillion asset. Could you upload more? Of course. But $250,000 would represent solid progress between halvings, and I think we'll at least see that.
Currently trading at $64,500, btc is down almost 3% in the last 24 hours after retesting the $67,000 mark on Tuesday and failing to consolidate above that level.
Featured image from Shutterstock, chart from TradingView.com
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