Why Bitcoin Could Surge to $1 Million: A Deep Dive by Bitwise

Bitwise CIO Matt Hougan positions Bitcoin as a digital store of value, akin to gold, designed to offer investors a hedge against fiat currencies and the banking system. Currently, the global store of value asset market is approximately $38 trillion, with gold accounting for $36 trillion and Bitcoin about $1.4 trillion, less than 4%. Hougan points out that if the overall size of the store of value market continues to expand, Bitcoin's relative value will also increase.

He further analyzes that Bitcoin's long-term price volatility has narrowed significantly, making it increasingly suitable for inclusion in mainstream institutional portfolios, potentially with an allocation of up to 5%. Achieving a price of over $1 million per Bitcoin depends not only on market size growth but also on increasing its penetration in the store of value sector. While there are risks of slowing market expansion or delayed adoption, the continuous inflow of institutional funds and the ongoing improvement of infrastructure in recent years provide realistic support for this goal.

Hougan believes that if Bitcoin can capture one-sixth of the global store of value market within ten years, its price trajectory will closely align with the historical evolution of digital and traditional assets. This growth model is not based on speculation but on the technology adoption curve and the principles of capital migration.