Matrixport Research Predicts Bitcoin Could Reach $56,000 with BlackRock ETF Approval
In a groundbreaking report, Matrixport Research has sent shockwaves through the cryptocurrency world by outlining how the approval of the BlackRock Bitcoin ETF could potentially drive the price of Bitcoin to unprecedented heights. Their predictions paint a vivid picture of a soaring digital asset market, with Bitcoin potentially reaching a staggering $56,000.
Matrixport’s visionary outlook is underpinned by several compelling factors, such as decreased US inflation and favorable macroeconomic conditions. These elements were detailed in their 2023 outlook report, published on December 9, 2022, aptly named ‘Matrix onTarget’. This comprehensive report not only foresaw a resurgence of Bitcoin and Ethereum but also anticipated a significant reduction in volatility across the market.
One key indicator that underscores the burgeoning interest in cryptocurrencies is the astounding performance of Grayscale Investments’ Bitcoin Trust (GBTC). Year-to-date, GBTC share prices have surged an impressive 167%, significantly outpacing Bitcoin’s more modest 71% growth. What makes this even more intriguing is the history of GBTC’s net-asset-value (NAV) discount. At the beginning of the year, this discount stood at a substantial -45%, which has since slightly narrowed to -43%. The turning point, however, arrived with BlackRock’s announcement of its ETF application on June 15, 2023.
Matrixport’s earlier analysis shed light on the enormous potential of the 15,000-strong US registered investor advisor (RIA) community, responsible for overseeing a staggering $5 trillion in assets. Even a conservative 1% allocation recommendation for Bitcoin from this group could usher in an impressive $50 billion in inflows. Drawing parallels with precious metals ETFs, which hold an estimated market cap of approximately $120 billion, and assuming that a portion of precious metal ETF investors, let’s say between 10-20%, decide to diversify their portfolio by investing in a Bitcoin ETF as a hedge against monetary debasement and inflation, we could witness a sizeable $12-24 billion influx into the Bitcoin ETF.
The most compelling aspect of Matrixport’s research is the potential impact of the BlackRock Bitcoin ETF’s approval. If we take Tether’s market cap as a proxy for potential ETF inflows and assume it increases by $24 billion, then a conservative estimate sees Bitcoin’s price rising to $42,000. However, with a more substantial influx of $50 billion, resulting from a mere 1% allocation recommendation by RIAs, the digital currency could potentially skyrocket to an astonishing $56,000.
These predictions, while speculative, underscore the growing influence of institutional investors and the broader acceptance of cryptocurrencies in the financial mainstream. BlackRock’s ETF application, in particular, has captured the attention of both crypto enthusiasts and traditional investors alike, signaling the ever-expanding role of cryptocurrencies in our global financial landscape.
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