Bitcoin News Today: Institutional Demand Fuels Bitcoin's Long-Term "Perfect Storm"

Anthony Scaramucci, founder of SkyBridge Capital, has issued a stark warning to investors in the cryptocurrency market, predicting that Bitcoin could experience a 40% price drop before eventually reaching a value of $500,000 within the next five to six years. The forecast highlights the inherent volatility of the cryptocurrency market and underscores the need for investors to adopt a long-term strategy, rather than reacting impulsively to short-term fluctuations. Scaramucci emphasized that market corrections are a natural part of the investment journey, noting that he has previously made the mistake of selling shares in major tech companies too early. He urged investors to avoid repeating the same error with Bitcoin and to maintain a patient approach to their holdings [1].

The warning comes as the broader cryptocurrency market experiences heightened volatility. Bitcoin recently pulled back from a record high of $124,291 to around $112,500, with some market participants anticipating further declines [2]. Scaramucci’s prediction reflects a growing consensus among investors and analysts that the current bullish momentum may not be sustainable in the short term. However, his stance is rooted in a long-term view of Bitcoin’s potential. Despite the anticipated downturn, Scaramucci remains optimistic about the cryptocurrency’s future, particularly given the increasing adoption by institutional investors and corporations [1].

In a separate but related development, crypto asset management firm Bitwise has projected Bitcoin to reach $1.3 million by 2035. This forecast is based on institutional demand, Bitcoin’s limited supply, and macroeconomic pressures. Bitwise’s base case scenario envisions a compound annual growth rate (CAGR) of 28.3% for Bitcoin over the next decade, far outpacing traditional assets like equities, bonds, and gold. The firm also outlined a bullish case, in which Bitcoin could climb to $2.97 million by 2035, and a bearish scenario, which could see the price drop to $88,005. These wide-ranging projections reflect the high degree of uncertainty and volatility still present in the market [3].

Bitwise attributes Bitcoin’s long-term potential to the shift in demand from retail to institutional investors. According to recent data, over 75% of Bitcoin trading volume on platforms like Coinbase comes from institutional participants, a trend that has historically been linked to major price movements. Institutional demand is currently outpacing daily Bitcoin mining output by a significant margin, creating a supply-demand imbalance that could drive upward price pressure. Additionally, corporate adoption of Bitcoin has accelerated, with 35 publicly traded companies now holding at least 1,000 BTC each. This trend is expected to continue as more corporations view Bitcoin as a strategic asset [3].

The combination of Bitcoin’s inelastic supply, institutional demand, and macroeconomic uncertainty has created what analysts describe as a “perfect storm” for long-term price appreciation. Bitwise also noted that 70% of existing Bitcoin remains unmoved for at least one year, indicating strong hodling behavior among current holders. This is further supported by concerns over the devaluation of traditional fiat currencies, as U.S. federal debt continues to rise and interest payments consume a significant portion of the federal budget. These factors suggest that Bitcoin’s role as a hedge against inflation and currency debasement may become increasingly relevant in the coming years [3].

While Scaramucci and Bitwise present contrasting timeframes—Scaramucci projecting a long-term move to $500,000 within five to six years, while Bitwise anticipates $1.3 million by 2035—their analyses converge on several key themes. Both emphasize the importance of institutional adoption, the inelastic supply of Bitcoin, and the need for investors to adopt a long-term perspective. However, Scaramucci’s warning of a potential 40% correction serves as a cautionary note, reminding investors that Bitcoin’s path to long-term gains will likely be marked by significant volatility and interim setbacks [1][3].

Source:

[1] Anthony Scaramucci Warns Bitcoin May Drop 40% Before ... (https://intellectia.ai/news/stock/bitcoin-could-plunge-40-before-hitting-500k-warns-anthony-scaramucci)

[2] Anthony Scaramucci warns Bitcoin will crash 40% before ... (https://www.cryptocraft.com/news/1358883-anthony-scaramucci-warns-bitcoin-will-crash-40-before)

[3] Bitwise Sees BTC Hitting $1.3M by 2035 (https://cointelegraph.com/news/dollar1-3m-bitcoin-by-2035-bitwise-thinks-so)