Bitcoin News Today: Bitcoin Could Hit $200 000 by 2025 as Crypto Enters U.S. 401(k) Plans

The potential inclusion of cryptocurrency in U.S. 401(k) retirement plans could mark a pivotal turning point for Bitcoin’s adoption and valuation, with some analysts forecasting the asset could reach $200,000 by the end of 2025. André Dragosch, head of European research at Bitwise, highlighted that such access could unlock billions in new capital, significantly boosting demand for Bitcoin [1]. The shift was enabled by an executive order signed by Donald Trump on August 7, which allowed Americans to include digital assets in their retirement portfolios [1].

According to Dragosch, the inclusion of crypto in 401(k) plans may have an even greater impact on Bitcoin’s price than the approval of U.S. spot Bitcoin ETFs in January 2024. He suggested that if just 1% of the $12.2 trillion retirement market allocated to Bitcoin, it could bring in $122 billion in capital, fueling further price appreciation [1]. The inclusion of Bitcoin in retirement accounts will likely be facilitated through Bitcoin ETFs, which are already available and widely held, particularly by major providers like BlackRock and Fidelity [1].

Financial advisers are reportedly considering higher allocation percentages, with some suggesting a 2.5% to 3% Bitcoin exposure for retirement portfolios, potentially increasing inflows beyond initial estimates [1]. These allocations may begin as early as this fall, coinciding with expected U.S. Federal Reserve rate cuts, which could further drive Bitcoin’s price upward [1]. Dragosch noted that if additional rate cuts materialize, the path to a $200,000 price target for Bitcoin by year-end becomes more plausible [1].

In addition to monetary policy, the economic incentives for large retirement plan providers to include Bitcoin ETFs are also strong. BlackRock, the issuer of the largest Bitcoin ETF with over $84 billion in assets under management, and Fidelity, with $22.4 billion in its ETF, have a clear financial interest in offering these options [1]. Meanwhile, Vanguard, another major player, has yet to approve such offerings, though discussions continue [1].

The U.S. Securities and Exchange Commission has also signaled its willingness to facilitate broader access to crypto in retirement accounts, provided proper safeguards are in place [1]. This regulatory openness is seen as a positive sign for long-term Bitcoin adoption, particularly as younger investors, who are more familiar with digital assets, begin to shape retirement investment strategies [1].

While the potential for Bitcoin to reach $200,000 by 2025 is a forecast based on current trends and market dynamics, actual price movements will depend on a range of factors, including macroeconomic conditions, regulatory developments, and investor behavior [1].

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[1] https://cointelegraph.com/news/401-k-crypto-retirement-plans-bitcoin-etf-analyst