Bitcoin (BTC) price could hit at least $ 535,000 if corporate buyers convert 10% of their cash reserves into the largest cryptocurrency.
In one of several findings from the latest Bitcoin: Preparing for Institutes report, investment firm ARK Invest said that an allocation of 1% from SP 500 companies would be enough to bring BTC spot prices / USD to USD 40,000 increase.
Minimum allocation of corporate BTC: 2.55%
The results come from institutional buyers continuing to focus on Bitcoin as a long-term alternative to cash.Specifically with a transaction that caught attention after $ 500 million left Coinbase.
“Based on search volume compared to 2017, the rise in Bitcoin prices seems less of a hype. As Bitcoin seems to be gaining more trust, some companies are viewing it as cash on their balance sheets. “is the report.
In terms of the longer-term impact businesses could have on a bitcoin shortage, ARK predicted that the potential allocations would likely well exceed the 1% level.
“Based on the daily returns of all asset classes over the past 10 years, our analysis suggests that the allocation to Bitcoin should be between 2.55% while minimizing volatility and 6.55% while maximizing returns,” wrote, adding :
“Based on ARK’s simulated portfolio allocations, institutional allocations between 2.5% and 6.5% could affect Bitcoin price by $ 200,000 to $ 500,000.”
The deep pockets narrative remains mainstream
Although BTC’s price action in the past few weeks has not provided a convincing continuation of the bull run, it believes the status quo will soon be reversed.. As Cointelegraph reported, wealth management giant Grayscale could set off the spark on Wednesday that will get the market going again.
“There is a large and emerging group of institutions with a huge capital base that are being reallocated to this area,” Michael Bucella, general partner of investment firm BlockTower Capital, told CNBC this week.
“And when you think about the supply and demand model of a commodity, the supply curve decreases over time until it reaches zero and demand increases exponentially.”
Meanwhile, on February 8th, the largest altcoin, Ether (ETH), you will also see special futures markets being activated by the CME Groupjust like bitcoin.