Bitcoin News Today: ARK's Dovish Bet: Fed Shifts and $300B Inflows Fuel $1.5M Bitcoin Vision

ARK Invest CEO Cathie Wood has reiterated a bold $1.5 million price target for Bitcoin by 2030, even as she anticipates a near-term reversal in the crypto liquidity crunch driven by Federal Reserve policy shifts and government spending normalization according to the report. The firm's latest moves underscore its conviction in the sector, with ARK deploying over $93 million in a single day to purchase crypto-linked equities such as Block, Coinbase, and Circle amid the recent market downturn ARK Invest CEO Cathie Wood forecasts the liquidity crunch will reverse. This strategy aligns with Wood's broader thesis that the liquidity constraints currently weighing on crypto and AI markets will ease within weeks, bolstered by three key factors: the Fed's end to quantitative tightening, the resumption of government cash flows post-shutdown, and potential rate cuts as economic data weakens ARK Invest CEO Cathie Wood forecasts the liquidity crunch will reverse.

The Fed's December 10 meeting is pivotal, with Wood forecasting the central bank will pivot from its hawkish stance to a more dovish tone, easing one of the primary pressure points on liquidity ARK Invest CEO Cathie Wood forecasts the liquidity crunch will reverse. Meanwhile, the U.S. government shutdown, which had temporarily hoarded $70 billion in liquidity, has concluded, allowing funds to re-enter the financial system. ARK projects an additional $300 billion in liquidity inflows over the next five to six weeks as Treasury operations normalize according to the report. These developments, combined with declining inflation expectations-ten-year Treasury yields now hover near 2.5%-create a more favorable environment for both equities and cryptocurrencies ARK Invest CEO Cathie Wood forecasts the liquidity crunch will reverse.

ARK's aggressive accumulation of crypto stocks highlights its long-term bet on the sector. The firm's flagship ARK Innovation ETF (ARKK) has deepened its holdings in Coinbase, Circle, and Block, which together constitute over 10% of the fund's portfolio. Despite a 30% drop in Coinbase's stock and a 51% decline for Circle since late October, ARK continues to buy the dip, deploying $42 million in crypto stocks on November 20 alone ARK Invest CEO Cathie Wood forecasts the liquidity crunch will reverse. This strategy mirrors the firm's historical approach of capitalizing on market volatility to position for future growth, a tactic that delivered 150% returns in 2020 but faced sharp reversals in subsequent years ARK Invest CEO Cathie Wood forecasts the liquidity crunch will reverse.

Wood's optimism contrasts with broader market turbulence. Bitcoin, which peaked at $126,000 in October, has since fallen to around $88,000, while crypto-linked equities face their steepest monthly declines since early 2024 ARK Invest CEO Cathie Wood forecasts the liquidity crunch will reverse. JPMorgan, however, has joined the bullish chorus, predicting Bitcoin could reach $240,000 over the long term as institutional adoption reshapes the market. The bank argues crypto is evolving from a speculative asset to a macro-driven class, with liquidity now dictated by broader economic trends rather than the four-year halving cycle according to the report.

Not all developments in the crypto space are bullish. CoinShares recently withdrew its SEC filing for a staked Solana ETF, citing unfulfilled structuring deals. Despite this setback, Solana ETFs have attracted $369 million in inflows since November, though the asset's price remains below $150, far from earlier analyst projections of $400 according to the report. Meanwhile, Ripple's XRP faces challenges in converting on-chain activity into sustained price gains, prompting some investors to pivot to projects like GeeFi, which is leveraging a presale to build a user-driven ecosystem according to the report.

ARK's track record remains a point of debate. While its high-risk, long-horizon strategy has historically underperformed, the firm's early bets on crypto-such as its 2015 Grayscale Bitcoin Trust investment and 2021 Coinbase purchase-have laid the groundwork for its current crypto-focused ETFs. Critics argue that ARK's concentrated portfolio and reliance on unprofitable firms expose it to extended drawdowns, yet Wood remains undeterred. "The fundamentals haven't changed," she stated, emphasizing that AI's growth trajectory and the Fed's pivot will underpin crypto's recovery according to the report.

As the Fed's December meeting looms, markets will closely watch for signals of a dovish shift. For now, ARK's $1.5 million Bitcoin target-once dismissed as overly ambitious-remains intact, reflecting a belief in the asset's long-term potential despite near-term headwinds according to the report.