In a series of statements On “. “I don't think I've ever been more bullish about bitcoin than I am right now,” he said, pointing to the cryptocurrency's recent performance and lack of widespread hype as a prelude to what he calls a 'supercycle.'
Understanding the concept of “supercycle” is crucial to grasping van der Chijs' perspective. Unlike regular market cycles that experience periodic ups and downs, a supercycle in bitcoin dominance refers to a prolonged period of bullish growth over several years. This phase is characterized by a substantial increase in adoption, demand and price, which often has far-reaching economic implications.
In essence, a supercycle marks a paradigm shift in which asset value increases dramatically, supported by a continued influx of investment and a growing consensus about its long-term viability. To reach this conclusion, Van der Chijs' prediction depends on several observations and trends within the bitcoin sector.
Why a bitcoin supercycle could be possible
First, note a significant shift toward bitcoin ETFs by funds, including yesterday's historic announcement of the Blackrock Strategic Income Opportunities Fund. This move signifies strong institutional interest that could fuel a steady flow of investment into bitcoin, setting the stage for a supercycle.
“It will be a constant flow of new money into ETFs. (…) The flows to the ETF are increasing, not decreasing,” said van der Chijs. Now that financial advisors are set to recommend bitcoin ETFs to clients following a regulatory settlement period, van der Chijs sees a flood of new capital on the horizon. This anticipation is not unfounded, considering the groundbreaking success of the bitcoin ETF launch, which he cites as “the most successful ETF launch ever.”
Corporate strategies around bitcoin also play a key role in van der Chijs' supercycle theory. He points to Microstrategy's aggressive leverage-based bitcoin purchases as a harbinger of a trend in which companies increasingly view bitcoin not just as an investment, but as a fundamental aspect of their financial strategy. This change, according to van der Chijs, could prompt other CEOs to follow his lead, further accelerating bitcoin's rise.
Additionally, a critical mass of financial advisors are on the verge of recommending bitcoin ETFs to their clients, pending the expiration of regulatory and due diligence waiting periods. This opens the doors to substantial new investments from a segment traditionally cautious regarding direct investments in cryptocurrencies. “They cannot sell the ETF during the first 90 business days (internal regulations are mainly due to DD), although they are accelerating the sale of this ETF,” van der Chijs said.
FOMO and a self-fulfilling prophecy
Speculation around unidentified large-scale bitcoin acquisitions adds another layer to the supercycle narrative. Van der Chijs alludes to the intrigue surrounding a wallet that has been steadily accumulating bitcoin, hinting at the involvement of a billionaire possibly similar to bitcoin-amazon-jeff-bezos-rumor/” target=”_blank” rel=”nofollow”>Jeff Bezos. “Since November 2023, a wallet has been adding an average of around 100 btc per day, the wallet now contains over 50,000 btc,” he claims, noting the potential for influential figures to catalyze broader market movements.
Another argument is possible purchases by nation-states. Although nation-state involvement in bitcoin has been minimal, with El Salvador being a notable example, any increase in such activities could trigger a domino effect. Nation-state participation in the bitcoin market could significantly elevate bitcoin's status as a sovereign asset class.
Next, the retail sector remains largely on the sidelines in the current cycle, but van der Chijs anticipates an increase in retail interest following new all-time highs and increased media coverage. This could start a FOMO cycle, attracting more investments from traditional asset classes towards bitcoin.
Lastly, van der Chijs mentions the concept of a self-fulfilling prophecy: as bitcoin continues to rise without significant declines due to the constant influx of new money, more people and institutions will consider the concept of a supercycle. This, in turn, could lead to greater capital allocation to bitcoin, making the supercycle more likely.
Macroeconomic implications of a supercycle
Van der Chijs' theory also addresses the possible macroeconomic implications of a bitcoin supercycle, predicting a significant shift in wealth and power structures. The redistribution of wealth could make bitcoin the center of a new economic order, in which traditional asset classes could lose ground.
In conclusion, Marc van der Chijs outlines a compelling argument for a coming bitcoin supercycle, supported by a confluence of institutional, corporate, speculative and retail trends. He acknowledged the speculative nature of his prediction: “Right now I think there's a maybe 10% chance of this happening and that chance is increasing (very slowly).”
However, the implications could be enormous. “It will change the existing world order. It will suck money out of the stock and bond markets, out of gold and other commodities, and even out of the real estate sector (global housing prices could collapse). “This will lead to btc prices we can’t even imagine today, potentially millions of dollars per btc.”
At the time of publication, btc was trading at $67,806.
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