Cathie Wood’s name is no longer obscure in the bitcoin community. The CEO of ARK Invest has emerged as one of the most vocal supporters of the digital asset. Wood set up her tent with bitcoin years ago and hasn’t looked back since. In fact, she has proven to be one of the most bullish in the field, predicting that bitcoin will be worth $500,000.
Wood has previously valued the asset at the exact amount at various times in the past, and she seemed unshaken in her commitment after restarting her position on the topic. The CEO has returned to defend her belief in the precise. She anticipates the value rising above $500,000 in the long term, estimating the time range at only five years.
Cathie Wood, CEO of ARK Invest, appeared on Barron’s on Wednesday. During the discussion, the CEO discussed her predictions for bitcoin and what she thought will propel the digital asset there. The first step was institutional investment in the asset.
It goes without saying that institutional investors have increased their positions in the digital asset market. With two months left in the year, inflows for the year have surpassed the record established in 2020. According to the most recent CoinShares report, total assets under management for bitcoin has quickly risen to a new high of $56 billion. This increased momentum, according to Wood, is what will propel bitcoin above $500,000.
Despite the fast rate of institutional investor involvement, it is projected that less than 5% is devoted to bitcoin. However, the tendency among large money is developing, and Wood indicated that if “institutional investors move into bitcoin and allocate 5% of their portfolios,” bitcoin will reach $560,000.
The CEO expects this to happen, but estimates a five-year timescale. Given current investing trends, Wood expects the price of bitcoin will exceed $500,000 by 2026.
The data stored on the bitcoin blockchain further supports the CEO’s firm belief in this prognosis. Because of blockchain technology, every transaction is public information, and she added that this data helps to observe how money is moving hands in the space. “We can tell because of on-chain analysis,” Wood explained.
Although Wood is bullish on institutional money entering the digital asset market, he was surprised by recent moves by companies such as Square, Tesla, and MicroStrategy to diversify their balance sheets using bitcoin. However, given that all of these enterprises are led by Bitcoin Maximalists, the market expected this.
Bitcoin’s low connection with other cryptocurrencies may also be a deciding factor for institutional investors interested in investing in the industry. “The correlation is quite low,” Wood said, adding that while the correlation of returns by investing is low, institutions may well be increasing their returns and risking less over time.