Bitwise’s CIO, Matt Hougan, recently addressed the question of whether Bitcoin’s price could reach $200,000 without the collapse of the US dollar. According to Hougan, the answer is “no.” In a comprehensive analysis shared on social media, Hougan explained his belief that Bitcoin can reach such a valuation without relying on a significant devaluation of the US dollar.
Hougan outlined two simultaneous risks involved in investing in Bitcoin. The first is the establishment of Bitcoin as a “store of value” asset, similar to gold. The second risk is the increasing pressure on fiat currencies due to government economic policies, which could result in greater demand for alternative assets like Bitcoin.
Currently, Bitcoin’s market cap is approximately 7% of gold’s estimated $18 trillion market cap. If Bitcoin were to mature and reach 50% of gold’s market cap, Hougan suggests that the value of one Bitcoin could exceed $400,000.
Furthermore, the potential mismanagement of fiat currencies by governments could lead to an increased demand for “store of value” assets. If the market for such assets triples and Bitcoin maintains its 7% market share, the price of Bitcoin could surpass $200,000.
Importantly, Hougan emphasizes that these two arguments are separate but complementary. He believes that if Bitcoin matures as a store of value asset and the market for such assets expands, the price of Bitcoin could quickly reach seven figures.
Hougan concludes that Bitcoin’s path to $200,000 lies in its continued growth as an institutional asset, rather than relying on the collapse of the US dollar.
*This article does not provide investment advice.