Highlights:
- Bitwise’s Matt Hougan suggests Bitcoin could hit $200K without a dollar collapse.
- Increased demand for store-of-value assets and government spending boost Bitcoin’s investor confidence.
- Bitcoin’s market cap stands at $1.4 trillion, about 7-8% of gold’s total.
Bitcoin’s (BTC) price could surge to $200,000 without the need for a collapse of the US dollar, says Bitwise Chief Investment Officer Matt Hougan. Some advocates believe Bitcoin requires a dollar collapse to surpass $200,000 per BTC. However, Hougan contends this assumption is flawed for two key reasons: increasing demand for store-of-value assets and ongoing government spending.
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The Bitwise executive said these factors strengthen investor confidence in Bitcoin. Hougan also noted that the store-of-value markets are gaining traction due to “governments abusing their currencies.”
He said:
“So, no, the dollar doesn’t need to collapse for bitcoin to hit $200k. All you need is Bitcoin to continue on its current path of maturing as an institutional asset. But it’s increasingly looking like both parts of the argument will come true. That’s why Bitcoin is surging toward all-time highs.”
Hougan made his comments on October 29, as BTC approached its all-time high from March. Technical indicators point to a potential Bitcoin breakout. However, historical trends suggest possible volatility as U.S. citizens get ready for the upcoming presidential election.
1/ A financial advisor asked me a great question over dinner last week:
Does the U.S. dollar need to collapse for bitcoin to hit $200,000?
The answer is "no." Here's why…
— Matt Hougan (@Matt_Hougan) October 29, 2024
U.S. spending has surged in recent years, with the national debt exceeding $35 trillion. Analysts estimate that it increases by approximately $1 trillion every 100 days at this rate. Unlimited Funds CIO Bob Elliott highlighted that “developed world sovereign debt,” such as U.S. Treasuries, may no longer serve as effective bailout tools. This shift could strengthen a pro-Bitcoin perspective.
The selloff in US bonds has sparked a global dump of developed world sovereign debt.
Since US yields started rising after the Fed meeting in Sept, global bond yields are higher, while the dollar and gold are surging, reflecting an increasingly global debt contagion.
Thread.
— Bob Elliott (@BobEUnlimited) October 29, 2024
BTC Has Made Progress But Is Not Mature Yet
Bitcoin’s total market capitalization is $1.4 trillion, which is about 7-8% of gold’s $18 trillion market cap. Hougan believes that BTC can “mature” to reach around half of gold’s value, making one Bitcoin worth approximately $400,000.
He added that due to governments “abusing” their control over fiat currency through money printing, more investors are likely to seek store-of-value assets. If Bitcoin maintains its 7% share of the gold market and demand for Bitcoin triples, each BTC would be valued at $200,000. “Importantly, these arguments compound. If Bitcoin matures and the store of value market doubles, you quickly get to seven figures,” he said.
Bitcoin’s Near-All-Time High Fails to Ignite Retail Investor Interest
According to crypto analyst Miles Deutscher’s October 29 post on X, there is still a lack of significant retail interest despite Bitcoin being on the verge of breaking its all-time highs.
#Bitcoin is on the verge of breaking all-time highs, and retail interest is still almost non-existent.
Higher. pic.twitter.com/EH4fWnjIvG
— Miles Deutscher (@milesdeutscher) October 29, 2024
Bitcoin reached a near-all-time high of $73,562 on October 29 but has since cooled to $72,400 at the time of publication, according to CoinMarketCap. Despite the recent surge, search interest for “Bitcoin” has a score of 23 out of 100, compared to peak search volumes in late May 2021, based on Google Trends data.
An October 26 report from CryptoQuant noted that while Bitcoin retail investors are “slowly returning,” they are being outpaced by larger investors in 2024. Daily BTC transfers by retail investors reached $326 million on September 21, the lowest since 2020.
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