ARK Invest’s Cathie Wood just reaffirmed her prediction that Bitcoin (BTC) has the tendency to reach a million. This time her numbers were pegged at $1.48 million per BTC by 2030.
Basis of Cathie Wood
Cathie Wood, the founder, CEO, and CIO of ARK since 2014, strongly believes in the capabilities of Bitcoin. Her over-the-million forecast for the digital asset is grounded on several factors.
First, the ARK boss sees the institutional adoption of the coin as the primary launching pad for its climb to unprecedented levels. She likens the digital asset matching other investments like emerging markets and real estate in terms of potential.
Wood’s next reasoning is anchored on the narrative that Bitcoin is an “obvious hedge against inflation.” She believes it’s more practical for companies to hold their balance in BTC rather than cash, which diminishes its purchasing power over time.
Lastly, the head of ARK foresees Bitcoin’s utility when it comes to remittances. She pointed out that using the cryptocurrency for overseas transactions would protect users from fiat’s volatility and hyperinflation.
How Reliable is Cathie Wood’s Predictions?
Besides her $6 billion company’s reputation on the line, Wood has successfully wagered on emerging technologies over the years. The ARK exec is best known for her accurate projection that Tesla would soar to a pre-split price of $4,000 back in 2018, which represented a 1,000% gain for its stock at that time.
However, dissecting her latest theory would reveal some discrepancies in the current state of Bitcoin according to Motley Fool’s Jeremy Bowman. The analyst primarily cited the crypto’s slow adoption even in El Salvador, which fully embraced it as a legal tender and reserve asset. Additionally, BTC has been constantly bashed by seasoned investors like Warren Buffet who referred to it as “rat poison squared” and JPMorgan CEO Jamie Dimon who said would “close it down” if he were the government.
Bowman also argued about BTC’s tendency to seesaw in prices, hence, obliterating its inflation hedge narrative and getting it marked by financial experts as a high-beta risk asset. Aside from its fluctuations as of late, a recent example is in 2022 when the digital money crashed together with the stock market. Let’s add to that Coin Bureau’s claim that 40% of its valuation is influenced by hype.
Finally, the Motley Fool analyst cleared out that volatility as well as lack of trust and security have hindered Bitcoin as a medium for remittances.
Bitcoin Now
As of this writing at 12:00 AM UTC on Monday, Bitcoin’s price dropped by 2% to $41,329.38 on the 24-hour chart. The trading volume of the most dominant cryptocurrency in the market, however, is up by 11.16% as it moved around $16 million between wallets during the period. Meanwhile, the same timeframe saw BTC tread between a low of $41,572 and a high of $42,359.
So far, its price is significantly down by nearly $3,000 after tapping the $44,000 mark two weeks ago.