Bitcoin's Growth Rate Drops to 30-40% as Institutionalization Accelerates

Willy Woo, a prominent cryptocurrency analyst, recently shared his insights on the future of Bitcoin. According to Woo, Bitcoin has transitioned from the phase of experiencing several-fold annual growth rates, as seen in 2017, to a more stable growth trajectory. He highlighted that 2020 was a pivotal year for Bitcoin's institutionalization, with corporations and sovereign entities beginning to accumulate the cryptocurrency. This shift has led to a significant drop in the compound annual growth rate, from over 100% to 30 to 40%.

Woo believes that Bitcoin is now being traded as the newest macro asset in 150 years and will continue to absorb global capital until it reaches a certain 'equilibrium point.' He predicts that the ultimate annual compound growth rate for Bitcoin will stabilize at around 8%, considering long-term monetary expansion of about 5% and GDP growth of 3%. However, Woo estimates that it may take another 15 to 20 years to reach this equilibrium point. He also noted that there is hardly any other publicly investable asset that can rival Bitcoin in long-term performance.

Woo's analysis suggests that despite the significant drop in the compound annual growth rate, Bitcoin still has upside potential. The cryptocurrency's institutionalization and its status as a macro asset indicate that it will continue to attract global capital. Woo's prediction of an 8% compound annual growth rate over the next 15 to 20 years highlights the long-term potential of Bitcoin as an investment asset. His analysis also underscores the unique position of Bitcoin in the global financial landscape, with no other publicly investable asset offering comparable long-term performance.