Text: Bian Chun
Matt Hougan, Chief Investment Officer (CIO) of Bitwise, the largest cryptocurrency fund management company in the United States, recently predicted that if the United States establishes a Bitcoin national reserve, the price of Bitcoin could soar to $500,000.
This means that Bitcoin has the potential to rise by nearly 400% from its current price. According to data from cryptocurrency news website Coindesk, the current Bitcoin price is $100,475.
After Federal Reserve Chairman Powell said on Wednesday that the Fed has no plans to hold digital currencies and hinted at a more cautious approach to rate cuts next year, the price of Bit dropped sharply, falling nearly 5% in the past 24 hours. Earlier this week, the cryptocurrency had briefly hit a record high of over $108,000.
Hougan said, the US purchasing Bit would drive more countries to buy cryptocurrencies.
"If we really establish a Bit strategic reserve, the government buying Bit... $200,000 Bit would start to look a bit conservative. You'll see $300,000, $400,000, $500,000 Bit. This is a big deal because governments around the world will do this (buy Bit)," Hougan said.
Hougan said he was skeptical when Trump first proposed the idea of establishing a national Bit reserve during the election campaign. But he pointed out that the idea "hasn't gone away," and that a new crypto bill proposed by Wyoming Senator Cynthia Lummis and more people within the Trump administration have expressed an open attitude towards establishing a strategic Bit reserve. Trump also hinted again last week in an interview at the New York Stock Exchange that he would establish a Bit reserve.
"I still think, you know, maybe the chances are less than 50%, but it's not zero," he added. "Again, if that happens, or if we start to see it happening in other countries, you're going to see Bit skyrocket, and 2024 will look pretty tame by comparison."
Since the US presidential election, Bit has risen 55%, and is up more than 140% so far this year.
Aside from the Bit strategic reserve, Hougan said that with continued investor demand, Bit is expected to rise to $200,000 over the next year.
He believes Bit has three "unstoppable" sources of demand: ETFs, Microstrategy (the publicly traded company that holds the most Bit), and potential Bit buyers among governments around the world.
"At the end of the day, it comes down to supply and demand. Demand is too high, supply is too low, so I think the price will be higher in 2025," he added.
As Trump's second term approaches, Wall Street's optimism towards cryptocurrencies is growing.
Standard Chartered Bank, which accurately predicted Bit's rise to $100,000 this year, also forecasts that by the end of 2025, the price of Bit will reach $200,000, and some more bullish forecasters predict Bit will rise to $500,000. Cryptocurrency lobbyist and CEO of the Digital Chamber, Perianne Boring, even boldly predicts that Bit will break through $800,000 next year.
