What happens when an unstoppable force meets an immovable object?
We’re about to find out soon.
And the answer will tell us where bitcoin’s price is headed next…
The unstoppable force is demand. And a flood of it is heading to bitcoin.
We’re already seeing that occur before our very eyes.
Bitcoin is up 137% since this time last year. And it’s outperformed every other asset class in 2023.
Most of the demand this year has been fueled by speculation over the approval of a spot bitcoin exchange-traded fund (ETF).
The biggest player here is BlackRock, which manages nearly $10 trillion in assets. That’s almost the same size as the entire $12 trillion gold market.
Fidelity, Invesco, Franklin Templeton, WisdomTree, and Ark Invest are all lining up to get a spot bitcoin ETF approved by the Securities and Exchange Commission (SEC), too.
Combined, these Wall Street titans manage $16.2 trillion in assets.
Now, imagine just 5% of that flows into bitcoin. Its market cap would more than double from today’s level.
Of course, this is a hypothetical… But it’s grounded in reality.
(Some studies show allocating 5–10% of your your portfolio to bitcoin and other cryptos can bring down volatility and improve returns.)
The SEC will eventually approve a spot bitcoin ETF – even if it has to be dragged kicking and screaming to do so.
When it does, these Wall Street giants will buy bitcoin. Their clients are demanding it.
According to one international study of 130 family offices responsible for managing $62 billion in assets… 90% say their clients want crypto included in their portfolios.
This is small potatoes compared to the trillions of dollars managed by BlackRock and the other “big boys” on Wall Street
They represent institutional investors like pension funds, sovereign wealth funds, insurance companies, and university endowments. And these clients want access to bitcoin, too.
So, yeah, 5% of their assets flowing to bitcoin doesn’t seem so hypothetical after all.
The immovable object is supply.
As you may know, bitcoin’s code limits its supply to 21 million tokens. There will never be more than that.
And every four years, bitcoin undergoes a “halving.” This simply means the new supply of bitcoin coming to market is cut in half.
That makes bitcoin a disinflationary asset (unlike the U.S. dollar, which you can print into infinity).
The next halving is scheduled for April 2024. And before every halving, we see a run-up in price. That run has already begun.
But the immovable object isn’t the 21 million bitcoin that will ever be printed… or the next halving.
It’s bitcoin HODLers. (That means “hold on for dear life.”)
These are the hardcore bitcoin believers. You’ll have to pry bitcoin from their cold, dead hands (or pay them a fat premium to get their coins).
According to data from crypto research firm Glassnode, long-term bitcoin investors are hoarding their coins at all-time highs.
By one measure, the amount of bitcoin held in wallets with minimal spending history hit a record of over 15.4 million tokens.
Remember, there will only ever be 21 million bitcoin. More than half of that is already locked up with HODLers.
By some estimates, another 10% of bitcoin has been lost forever. Others put it as high as 25%.
When the unstoppable force of demand hits the immovable object of supply… Something has to give.
Simple economics suggests the price. It’s about to explode higher.
As Daily editor Teeka Tiwari puts it, “It’ll be like trying to push an elephant through a mouse hole.”
That’s why Teeka sees bitcoin hitting $500,000 sooner than many people think.
And as bitcoin goes, so do the altcoins.
The last time bitcoin went on a run like this, Teeka’s readers had a chance to make 27 times…. 56 times… and even 850 times their money – in less than two years.
Earlier this week, Teeka held an event to discuss details about five altcoins he believes can make similar types of gains in this next crypto bull market.
You can watch the replay right here.
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Regards,
Chaka Ferguson
Editorial Director, Palm Beach Daily