Bitwise Raises Bitcoin 2036 Price Target to $1.6 Million, Sees 34.3% Annual Return
Bitwise, the digital-asset manager, raised its 2036 price target for Bitcoin to $1.6 million from $1.3 million. The firm projects a 34.3% annualized compounded return over the next decade, citing institutional inflows and limited new supply.The Block reported on October 28 that Bitwise outlined the forecast in a report published that day titled “2027 Bitcoin Long-Term Capital Market Assumptions.” The report compared projected annual returns across asset classes, estimating 6.7% for U.S. equities and 10.8% for private equity.Bitwise said the higher target reflects a larger estimate of the markets Bitcoin could penetrate. It raised its 2036 estimate for the global store-of-value market to $110 trillion from $91 trillion, and for the institutional investment market to $303 trillion from $216 trillion. It kept its assumptions for Bitcoin’s market share in each market unchanged.The firm said greater institutional allocation could generate demand far exceeding new supply. Citing estimates from Boston Consulting Group, Bitwise said that if institutional investors allocate 1% to 5% of the roughly $147 trillion they manage to Bitcoin over the next 10 years, that could create $1.5 trillion to $7.4 trillion in demand. By contrast, new supply from mining amounts to about $14 billion a year.Its base-case target of $1.6 million assumes Bitcoin captures 25% of the store-of-value market and 1% of institutional assets by 2036. Bitwise set a bear-case target of $130,686 and a bull-case target of $3.67 million.“We are more bullish on Bitcoin than we were a year ago,” Matt Hougan, Bitwise’s chief investment officer, said. He cited smaller drawdowns in the recent correction than in past cycles, regulatory progress and growing demand for store-of-value assets such as gold as support for long-term growth.Bitwise also forecast that Bitcoin’s price volatility will decline over time. It lowered its projection for average volatility over the next decade to 27.8% from 32.9% a year earlier.Ryan Rasmussen, Bitwise’s head of research, said Bitcoin will remain a volatile asset prone to sharp declines. As institutional participation deepens, however, price swings should narrow.