U.Today – In a bold forecast, analyst Willy Woo predicts that Bitcoin will surpass the market capitalization of gold once ETFs have completed their role.
According to Woo, the recently launched Bitcoin ETFs offer BTC price targets of $91,000 in the bear market and $650,000 in the bull market, which could happen once ETF investors have fully deployed capital according to the recommendations from asset managers.
While enthusiasm for these bold price forecasts persists, Woo cautioned that these targets may not be achievable in this cycle because capital deployments take a long time to complete. He outlines in six points what he considers “backward calculations” in support of this prediction.
Woo bases his forecast on the premise that the $100 trillion under management by asset managers typically has a 2% allocation recommendation. This yields an estimate of approximately $2 trillion of potential allocation in BTC, which he believes could increase over time.
Woo further estimates that BTC currently has an investment of $561,159,959, citing on-chain data; an influx of $2 trillion would increase the amount to more than $2.56 trillion.
Using MVRV to calculate market capitalization versus money invested, a ratio that is 5x at bull market highs and 0.7x at bear market lows, this translates to market capitalizations of $12.8 trillion and $1, 8 trillion, respectively, which translates to $650,000 and $91,000 for the BTC price. in bullish and bearish market scenarios, respectively.
Excluding other self-custody entries, Woo believes that Bitcoin could certainly surpass gold's capitalization when the asset manager's capital is deployed. Since gold experienced a 12-year bull run after its ETF was approved, Bitcoin may do the same.
At the time of writing, BTC was up 0.49% in the last 24 hours to $64,524. According to Bloomberg, Bitcoin's dominance in the cryptocurrency market has reached a three-year high, reflecting strong demand for US exchange-traded funds that hold the largest digital asset, as well as a challenging era for the smallest tokens.
According to data from CoinMarketCap, Bitcoin accounted for around 55% of the $2.4 trillion cryptocurrency market at the end of last week, a level not seen since April 2021.
This article was originally published on U.Today.
