Bitwise CIO Predicts 139% Bitcoin Gain to $200,000 by Year-End

Matt Hougan, the chief investment officer of Bitwise, a prominent crypto asset management firm, has identified a key factor that could significantly boost Bitcoin's value. In a recent interview on the Unchained podcast, Hougan emphasized that the demand for Bitcoin exceeds its supply, a dynamic that he believes will drive the cryptocurrency's price to around $200,000 by the end of the year. This projection represents a 139% increase from its current level.

Hougan's analysis is based on the observation that the new supply of Bitcoin is limited to 165,000 coins annually. In contrast, exchange-traded funds (ETFs) and corporations have shown substantial appetite for Bitcoin, purchasing 500,000 and 350,000 coins respectively in the past year. This imbalance between supply and demand suggests that existing holders will need to sell their Bitcoin to meet the growing demand, potentially driving the price higher.

Hougan predicts that the price could reach $200,000 because he believes that this round number will be a psychological threshold at which existing holders will be more willing to sell. He anticipates that once the macroeconomic market stabilizes, this fundamental demand-supply mismatch will continue to push Bitcoin's price upward until it reaches a level where existing holders are compelled to sell.

Looking ahead, Hougan expects that governments, corporations, and institutional investors will continue to drive demand for Bitcoin. He forecasts that governments will acquire hundreds of thousands of Bitcoin in the coming year, while corporations, which already purchased 350,000 coins last year, will likely increase their holdings. Additionally, institutional investors are recognizing Bitcoin as an integral part of the global capital markets, leading to significant inflows of capital into the cryptocurrency.

Hougan's optimistic outlook is grounded in the belief that the current demand for Bitcoin is structurally driven and will persist as more entities, including governments and corporations, integrate Bitcoin into their portfolios. This structural demand, coupled with the limited supply of new Bitcoin, creates a scenario where the price of Bitcoin is poised for substantial growth.