According to River’s research, this scenario is based on increasing institutional interest in Bitcoin and the transfer of trillions of dollars of capital from traditional investment portfolios to Bitcoin.
Bitcoin Investment Still Quite Low!
River begins its analysis by examining Bitcoin’s current adoption rate. According to the data presented in the analysis, approximately 4% of the world’s population owns Bitcoin. However, institutional investors’ portfolio allocation to Bitcoin remains quite low. River notes that investment advisors allocate only about 0.008% of their total assets to Bitcoin.
Wall Street’s Bitcoin Allocations Are Critically Important!
River analysts stated that their forecast is based on increased corporate adoption and, in particular, capital coming from Wall Street.
At this point, River calculated the capital inflow that could occur if 20% to 40% of global investment portfolios were invested in Bitcoin, with an average allocation of 2% to 4% of Bitcoin within these portfolios. In this scenario, they estimated a net capital inflow into Bitcoin of between $1.3 trillion and $5.3 trillion.
Where Could Capital From Wall Street Take the Bitcoin Price?
River analysts stated that, based on historical data, they hypothesized that every $1 of net capital inflow into Bitcoin could generate approximately a $3 increase in market value.
According to the company’s calculations, a capital inflow of $1.3 to $5.3 trillion could push Bitcoin’s total market capitalization to approximately $5.5 trillion to $17.5 trillion.
In this scenario, the price of Bitcoin could reach approximately between $250,000 and $840,000. River’s highest price scenario of $840,000 is based on a net capital inflow of approximately $5.3 trillion.
River also notes that Bitcoin’s next major price movement cannot be explained solely by the behavior of investors in the cryptocurrency market. According to the company, the real determining factor will be the extent to which investors in the traditional finance sector include Bitcoin in their portfolios.
River analysts emphasize that the $840,000 figure is not a definitive price target.
*This is not investment advice.
