Bitcoin Price Rally to $500K Can be Triggered by This Phenomenon: Bitwise CIO

In an interview, Matt Hougan, the Chief Investment Officer at Bitwise Asset Management, has said that if the United States begins to use a strategic bitcoin reserve, Bitcoin price could be worth $500,000. This prediction comes after debates on a bill that could make Bitcoin a reserve currency in the country.

According to Hougan, the setting up of a Bitcoin reserve by the U.S. government would have a domino effect. This would make other countries emulate the same strategy. These global interests will raise the demand for Bitcoin and the price per coin may rise to over $200,000, and possibly between $300,000 and $500,000.

Bitcoin ETFs Drive Demand With $36.73 Billion Inflows

In the United States, ETFs have played a big role in growing demand for Bitcoin with investors pumping $36.73 billion into the cryptocurrency this year. These investment vehicles now own 5.76% of the total bitcoins in circulation, which cements their position in the asset market.

The launch of Bitcoin spot ETFs in the United States has provided institutional, and retail investors with easier access to bitcoins. This has made ETFs the driving force behind Bitcoin price growth, especially given the large funds transfer into the instrument in 2024.

Furthermore, and more recently, BlackRock’s endorsement of a 1% to 2% allocation of the portfolio to Bitcoin ETFs demonstrated the increasing institutional investment in the digital asset.

Public Companies Adopt Bitcoin as a Reserve Asset

In the current world, more and more public companies are adopting Bitcoin into their balance sheets as a reserve currency. Traditional corporations such as MicroStrategy and Marathon Digital have been joined by newcomers such as Rumble and Metaplanet, both of which see Bitcoin as a long-term asset.

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Most recently, the CEO of Metaplanet, Simon Gerovich announced the company’s goal of acquiring 10,000 Bitcoins by 2025, similar to the strategy adopted by MicroStrategy. While speaking at the Bitcoin MENA conference, he explained that Metaplanet has chosen to use BTC yield as one of the most important metrics and the company wants to achieve 100k-500k shareholders by 2025.

Furthermore, in institutional adoption, companies like MicroStrategy have been instrumental in taking Bitcoin’s rally to its current ATH of $107,162. The company has managed to acquire 439,000 BTC, which accounts for 2.1% of the total Bitcoin supply, evidencing the increasing interest of institutional investors.

This trend shows a new approach in the business strategy since more companies are taking advantage of Bitcoin’s scarcity and the possibility of its appreciation. Inclusion by big public firms only creates more demand, which in turn drives the upward price trend of the asset in the market.

Bitcoin Price Performance

However, at press time, Bitcoin price is trading at $104,588, with a 2% drop in the last 24 hours. The market capitalization of the digital currency is $2.07 trillion with $77.22 billion traded in the previous day, showing a 3% decline in trading volume. Bitcoin which has reached a recent high of $107,033 has now slightly pulled back due to the bearish market.

Analysts, including Hougan, remain optimistic about Bitcoin price in 2025. Even with no U.S. Bitcoin reserve in place, the market still shows that Bitcoin may surge to $200,000 owing to the impact of ETFs, business adoption and the world’s interest in cryptocurrencies as a reserve asset.