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Bitcoin could rise 5,453% by 2030, according to Cathie Wood. But is it realistic?
Enthusiasm is strong in the cryptocurrency space, but investors shouldn’t get ahead of themselves.
At the current price of around $68,500, Bitcoin (Bitcoin 0.42%) has a market capitalization of over $1.35 trillion, making it the most valuable cryptocurrency in the world. In fact, it represents more than half of the $2.55 trillion total market capitalization of the entire crypto ecosystem.
But Ark Investment Management and its technology investment leader, Cathie Wood, believe Bitcoin is set to rise much higher. Ark research suggests the cryptocurrency could rise 2,115% to nearly $1.5 million by 2030, but Wood herself recently released an even more bullish estimate, saying Bitcoin could rise 5,453% to 3 .8 million dollars.
Investor enthusiasm for Bitcoin and the cryptocurrency industry in general is through the roof right now, but widespread adoption remains far out of reach, so are Wood’s latest predictions realistic?
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Bitcoin may never replace traditional money
Bitcoin enthusiasts often say this cryptocurrency it is a strong candidate to replace traditional money because it is truly decentralized. It is not controlled by any person or institution, and that is how it is blockchainThe data-driven registration system is accurate and transparent.
I don’t agree with the idea that it could replace existing currencies for a few reasons. The ability to control the money supply allows governments and central banks (such as the United States Federal Reserve) to cushion economic shocks during turbulent times. Additionally, different economies operate at different speeds, which is why some currencies are more valuable than others.
If every country adopted a currency, for example Bitcoin, many exporting countries would lose one of the mechanisms through which they remain competitive. For example, two countries that export oil might have different production costs, because one might have higher labor standards than the other. As a result, that country would have to charge more money for exactly the same product. A weaker currency makes up some of that price difference for the buyer, allowing the exporting country to compete with those that have lower production costs.
The benefits of each nation having its own currency were also seen when the United Kingdom voted to leave the European Union in 2016 (an event known as Brexit). Investors feared that the UK would suffer economically due to the decline in free trade with Europe, so they quickly devalued the British pound by 16% (against the US dollar). Pessimism aside, it immediately made the UK much more competitive as an exporter on the global stage, thus cushioning some of the economic shock.
In theory, the only way Bitcoin could ever be adopted as “the” global currency is if each nation agreed to operate under a single government, with common economic goals. Given the state of world politics today, I’d bet my bottom dollar that it won’t happen anytime soon.
So far, few consumers and businesses have voluntarily adopted Bitcoin
The reality today is that very few businesses are willing to accept Bitcoin as payment for goods and services, meaning consumers don’t have much incentive to hold it except for speculative purposes. According to Cryptwerk, only 9,449 merchants accept Bitcoin, which is a drop in the bucket considering there are more than 300 million registered businesses globally.
Bitcoin plummeted 65% in 2022 before rising 255% in 2023. This level of volatility would make cash flow management impossible for any business, which is another argument against its usefulness as a currency.
Ark Invest points to eight use cases for Bitcoin that could drive its adoption by 2030. Most of them focus on countries, businesses and consumers that use Bitcoin to make payments and settle transactions. For the reasons I’ve already outlined, I don’t like the odds of this happening on a large scale. But three of Ark’s potential use cases suggest that Bitcoin could instead be used as a store of value:
- Digital Gold: Ark believes that Bitcoin could be treated like digital gold, which will create demand from multiple sources. Although Bitcoin is volatile, its decentralized nature and long-term upward trajectory support its credibility as a store of value.
- Corporate treasury: If Bitcoin is seen as a store of value, Ark believes companies could hold a small portion of the cryptocurrency on their balance sheets. This could, for example, help offset inflationary pressures over time.
- National Treasury: Many global governments and central banks hold physical gold in their reserves. Again, Bitcoin could be a great addition to those reserves if it were seen as a store of value.
The Store of Value Argument Will Not Take Bitcoin to $3.8 Million
At the Bitcoin Investor Day conference in March, Wood said the recent launch of Bitcoin exchange-traded funds (ETFs) could spur a wave of demand from institutional investors. It’s a key reason why he believes the cryptocurrency could rise 5,513% from now to $3.8 million by 2030, far above his company’s target of $1.5 million.
The problem with Wood’s predictions is that a price of $3.8 million for Bitcoin implies an eventual market capitalization of $79.8 trillion. This means that Bitcoin would be almost 3 times more valuable than the entire US economy, based on the latest annual GDP figure of $28.3 trillion. It would also be 25 times more valuable than Microsoftwhich today is the largest company in the world.
This doesn’t seem realistic to me. After all, the existence of ETFs doesn’t suddenly make Bitcoin a viable currency worthy of widespread adoption. But as a store of value, it’s conceivable that Bitcoin’s market capitalization could one day match that of gold, which currently stands at around $15.7 trillion.
This implies that Bitcoin could trade at $817,000, which would represent an upside of 1,094% from here. Therefore, the cryptocurrency could still deliver attractive gains if enough investors view it as a store of value, but I wouldn’t bet on a 5,513% rally from here to meet Wood’s predictions.
Antonio Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions and recommends Bitcoin and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.