TLDR
- Matt Hougan, Bitwise’s Chief Investment Officer, believes Bitcoin can reach $1 million per coin
- The store-of-value asset market currently stands at approximately $38 trillion globally
- Bitcoin’s current market share sits below 4% of this total
- A 17% capture of the forecasted $121 trillion market would bring Bitcoin to $1 million
- Growing institutional adoption and spot ETF launches strengthen the bullish thesis
Matt Hougan, serving as Chief Investment Officer at Bitwise, has doubled down on his forecast that Bitcoin will eventually trade at $1 million per coin. His latest analysis, presented in a memo called “How Bitcoin Gets to $1 Million,” was released earlier this week.
Hougan’s thesis centers on examining the worldwide store-of-value asset market — financial instruments individuals and institutions use to maintain wealth across time. Gold currently dominates this category.
This store-of-value sector has a present valuation slightly below $38 trillion. Within that figure, gold commands approximately $36 trillion, whereas Bitcoin holds around $1.4 trillion, representing under 4% of the overall market.
According to Hougan, investors frequently misjudge Bitcoin’s potential by failing to recognize the rapid expansion of the store-of-value market itself. When the United States saw its first gold ETF debut in 2004, gold’s total market capitalization stood at roughly $2.5 trillion. It has subsequently ballooned to nearly $40 trillion — representing approximately 13% compound annual growth.
Hougan attributes this expansion to escalating sovereign debt levels, heightened geopolitical instability, and accommodative central bank policies.
How Bitcoin Gets to $1 Million
Assuming the store-of-value sector maintains comparable expansion rates, Hougan projects it could swell to $121 trillion over the coming decade. Under that scenario, Bitcoin would require only approximately 17% market penetration to achieve $1 million per coin.
By today’s metrics, Bitcoin would need to command over 50% of the existing market to reach that valuation. However, Hougan’s projection relies on overall market expansion — not on Bitcoin achieving majority dominance.
He highlights recent industry milestones as validation that momentum favors this trajectory. Just a few years back, spot Bitcoin ETFs didn’t exist in the United States. Today, they rank among the most rapidly adopted ETF offerings ever launched.
Major institutional players have begun entering the market as well. Both Harvard University’s endowment and Abu Dhabi’s sovereign wealth fund have incorporated Bitcoin into their investment strategies.
Bitcoin’s Volatility Has Been Declining
Hougan further observed that Bitcoin’s volatility measured over longer timeframes has been diminishing. Consequently, certain institutional investors now consider allocations around 5%, representing an increase from previous recommendations that hovered near 1%.
Hougan remains transparent about potential headwinds. The store-of-value market might expand more slowly than anticipated, and Bitcoin’s market share gains could stall.
He also acknowledged that his forecasts might ultimately prove “too conservative” should anxieties surrounding sovereign debt and currency devaluation intensify.
This isn’t Hougan’s inaugural discussion of this price target. In a 2023 analysis, he suggested Bitcoin could surpass $1 million by 2032. More recently last month, he projected it might climb to $6.5 million over a 20-year horizon.
Bitcoin presently captures less than 4% of the worldwide store-of-value market, per Hougan’s most recent calculations.
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