In a time of extreme volatility in the crypto market, a major investment firm is predicting Bitcoin (BTC-USD) will hit US $1 million by 2030.
ARK Invest is a closely watched investment fund known for its prescient high-risk, high-reward strategy.
Cathie Wood is the CEO and CIO of ARK and is known for her radical transparency in explaining - via a public newsletter - her decisions to buy and sell.
It's important to note that Wood previously predicted Bitcoin would reach US$500,000 by 2026. We are now in 2022 and in the midst of a major 'crypto winter'.
“Bitcoin’s market capitalisation still represents a fraction of global assets and is likely to scale as nation-states adopt [it] as legal tender,” wrote ARK analyst Yassine Elmandjra in the firm’s Big Ideas 2022 outlook report, which was released last Tuesday.
Additionally, ARK said, "Bitcoin is taking market share as a global settlement network".
According to ARK’s research, Bitcoin’s cumulative transfer volume increased by 463 per cent in 2021 alone, and its annual settlement volume has surpassed Visa’s annual payments volume.
What do other experts think?
"ARK Invest has put a $1 million price target on Bitcoin by 2030, citing growing adoption and a recent increase in long-term holders," Sven Wenzel, founder of Castello Coin, told Yahoo Finance.
"A recent report from Cathie Wood’s investment firm argued that Bitcoin represents only a fraction of the world’s assets, which gives credence to the idea that the asset could hit as high as seven figures in the future.
"While Bitcoin has had a rocky few weeks, all of the data points to increasing adoption. Even if the path to get there isn’t smooth, it’s possible that Bitcoin could ultimately live up to its 'digital gold' narrative.
"However, Bitcoin has a challenge regarding ESG concerns over mining," Wenzel added.
He said miners may need to adapt to clean energy resources before the world was ready for adoption.
"That’s hard to argue with given the growth the network has seen of late, but it does have challenges: Ethereum will need to shake off competitors like Solana, namely through scaling."
However, investors should be aware that both Bitcoin and Ethereum are facing challenges.
As recent weeks have shown, they are also prone to extreme volatility, on both the upside and downside.