$2.3 million scenario for Bitcoin from Ark Invest

Investment firm Ark Invest has released its annual "Big Ideas 2024" report. The most notable part of the report was the Bitcoin target given. Accordingly, the company suggested that if Bitcoin accounted for 19.4% of global assets, its price could reach $2.3 million.

"The optimal portfolio allocation ratio for Bitcoin is 19.4%"

The study looked at the returns of various assets, including Bitcoin, gold, and stocks, over the past five years to see the allocation of capital to maximize risk-adjusted returns. In the review, it was concluded that the optimal ratio in the portfolio for Bitcoin is 19.4 percent.

Applying this result to a scenario in which the $250 trillion global investable asset base is reorganized, Ark Invest estimated that such a portfolio allocation would push Bitcoin's price to $2.3 million.

On the other hand, the company emphasized that if a portfolio allocation of 1 percent is made instead of the 19.4 percent rate, the price could reach 120 thousand dollars.

"Anyone who keeps it for 5 years makes a profit"

The report also highlighted that Bitcoin outperforms all major asset classes such as gold, stocks, or real estate in long-term investment returns. Bitcoin's compound annual growth rate (CAGR) is 44%, which dwarfs the average asset class CAGR of 5.7%. What's more, historically, those who hold Bitcoin for at least 5 years have made a profit no matter when they bought it.

Catalysts that could affect Bitcoin's trajectory

Finally, Ark Invest also pointed out four key catalysts that could influence Bitcoin's trajectory this year:

• Launch of spot Bitcoin ETFs
• Bitcoin block reward halving
• Enterprise adoption
• Regulatory developments

The report claimed that previous block reward halvings paved the way for bull markets, and that the upcoming halving could have a similar effect.

Published: February 4, 2024 11:43 am