Bitwise Predicts A Major Shift For Bitcoin

Thousands of billions of dollars could converge towards bitcoin over the next decade. This projection, put forward by Matt Hougan, Chief Investment Officer at Bitwise Asset Management, illustrates the acceleration of institutional adoption of cryptos. Far from a mere speculative scenario, the development of ETFs and regulated investment vehicles pushes the largest asset and wealth managers to progressively integrate bitcoin into their allocation strategies. A dynamic that could sustainably redefine the valuation outlook of the crypto market.

In Brief

• Bitwise anticipates the injection of thousands of billions of dollars over the next ten years.
• An allocation of only 1% of the global institutional pool would support this price by 2035.
• The calculation is based on capturing 25% of an expanding store-of-value market.
• The gradual integration of these funds aims to transform Bitcoin into a permanent global reserve asset.

Bitwise’s Financial Modeling

While the BPI 110 enters its decisive phase, rigorous mathematical modeling lies at the heart of Matt Hougan’s recent statements. This model relies on precise macro-financial data and a direct historical analogy :

• Institutional capital volume : estimated between 100,000 and 200,000 billion dollars worldwide ;
• Target allocation : an injection of only 1% of this monetary mass towards bitcoin would be enough to support the path to 1,300,000 dollars per coin by 2035 ;
• An analogy with physical gold : at the launch of the first Gold ETFs in 2004, the precious metal market represented 2,000 billion dollars, compared to about 30,000 billion dollars today;
• Overall sector growth : the analysis projects continued expansion of the safe haven market at the historical rate of 13% per year ;
• Target market share : achieving the 1.3 million dollar target is based on the assumption that bitcoin will capture 25% of this expanded store-of-value market over the next ten years.

The argument does not rely on a skyrocketing price or irrational enthusiasm from the retail market, but on the mechanical reality of bitcoin’s algorithmic scarcity facing an institutional capital stock seeking diversification assets. Thus, capturing these market shares from physical gold forms the central pillar of the fundamental valuation proposed by the American asset manager.

A Staggered Adoption Sequence by Institutional Investors

The deployment of these thousands of billions of dollars will not happen uniformly, but according to a strict timeline dictated by management mandates and regulatory requirements. Matt Hougan explicitly emphasizes that it is a very long-term deployment process, stating: “this is a process that will take over 10 years.” The first wave of adoption, currently underway, is driven by independent financial advisors and wealth management offices, as evidenced by quarterly 13F filings submitted to U.S. regulatory authorities. This movement is amplified by initiatives from banking giants such as Morgan Stanley and Wells Fargo, which are gradually facilitating access to Bitcoin ETFs for their wealth management clientele.

Subsequent waves will involve entities with longer and more conservative decision-making processes, including endowment funds, foundations, insurance companies, pension funds, and ultimately sovereign wealth funds and central banks. Thus, the gradual integration of these major players requires thorough compliance checks and regulatory adjustments that will stretch over several financial years.

The End of the Strategy Era as the Main Demand Driver

Alongside this staggered arrival of new investors, the market records a fundamental realignment of its historical demand drivers, embodied by the evolving role of the company Strategy. While acknowledging the major contribution of the company led by Michael Saylor, who remains the largest institutional holder with 842,138 BTC, Bitwise estimates that the entity will no longer be the primary driver of overall demand. Strategy’s ability to issue convertible debt and maintain a significant premium on the net asset value diminishes as the market matures and offers direct liquid alternatives such as spot ETFs.

Although the company continues to accumulate bitcoin, its acquisition pace is expected to slow and align more closely with the asset’s traditional price cycles. Distortions in the capital markets that Strategy capitalized on now reach their structural limits due to the maximum absorption capacity of the bond market for this type of corporate structure.

This shift towards a market dominated by a diversified institutional investor base indicates a gradual reduction in extreme volatility in favor of deeper liquidity. For market participants, understanding this paradigm shift implies adopting an expanded investment horizon.

As Matt Hougan summarizes regarding long-term investor attitude, the relevant question for institutions isn’t whether the asset has hit a local bottom but whether the peak has been reached. The gradual integration of bitcoin and other cryptos into global strategic allocations could thus definitively transform crypto’s status, making it shift from a speculative instrument to a structural component of the international financial system.