Standard Chartered predicts that Bitcoin could reach $500,000 by the end of Donald Trump’s term due to increasing institutional purchases, especially from sovereign wealth and pension funds. Enhanced access through ETFs and the involvement of significant players like Abu Dhabi will likely stabilize Bitcoin’s price and invite further long-term investments.

Bitcoin has started the year with volatility, yet significant institutional interest is on the rise. Major finance firms are increasing their investments in Bitcoin, prompting Standard Chartered to project that the cryptocurrency could reach $500,000 by the end of Donald Trump’s current presidential term. Geoff Kendrick, the bank’s Global Head of Digital Assets Research, highlights the role of sovereign wealth funds and pension funds in catalyzing this bullish outlook, following hedge funds’ leadership in the market since last year.

The anticipated launch of exchange-traded funds (ETFs) in 2024 is expected to broaden Bitcoin’s accessibility, providing essential support to its price journey. Notably, aggressive purchasing by Michael Saylor has previously propelled Bitcoin to a peak of approximately $108,000 in December. However, since then, the currency has struggled to maintain stability above the $100,000 mark.

Recent disclosures indicate that hedge funds are currently at the forefront of Bitcoin acquisitions, closely followed by investment advisers. Banks have recently begun to participate more actively, particularly since the third quarter. The repeal of SAB 121 is expected to further boost institutional involvement, as larger entities show increased interest in accumulating Bitcoin.

Kendrick notes that additional buyers are poised to enter the market soon. An influx of institutional investments could lead to reduced volatility for Bitcoin, encouraging investment managers to allocate larger portions of their portfolios to the cryptocurrency. This movement will potentially attract long-term investors, including sovereign wealth funds, to participate in the Bitcoin ecosystem.

Among the early adopters, some institutions, like those in Abu Dhabi, have already started purchasing Bitcoin. Although only a handful of pensions, such as the State of Wisconsin Investment Board and the State of Michigan Department of the Treasury, have invested in Bitcoin thus far, these are some of the most financially robust entities. Kendrick anticipates that broader long-term institutional investment will follow, spurred by early success from sovereign investors.

In summary, Standard Chartered forecasts Bitcoin could surge to $500,000 driven by newfound interest from institutional investors, particularly sovereign wealth and pension funds, alongside the expected benefits from ETF access. As larger entities begin to balance Bitcoin into their portfolios, volatility may diminish, allowing for an even greater allocation of funds into this digital asset. The evolving landscape of institutional investment bodes well for Bitcoin’s future potential.

Original Source: www.dlnews.com

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