Starting in early 2024, some of the world’s most well-known billionaires, who have managed some of the largest hedge funds, began buying shares of the iShares Bitcoin Trust, a Bitcoin spot price tracking ETF issued by the firm BlackRock. Although their investments were relatively small in size, they represent significant investments by individuals with very successful financial track records. Extreme price increases were forecast by several Wall Street sources, predicting that Bitcoin prices could enhance by up to 73,000 per cent by 2045, assuming that mainstream adoption becomes more widespread via vehicles such as spot ETFs, which dramatically eases the investment process and eliminates the extra fees associated with investing in cryptocurrencies through exchanges.
Financial analysts such as Cathie Wood of Ark Invest and Michael Saylor of MicroStrategy have estimated Bitcoin’s potential price around the end of the next two decades, reaching US$3.8 million and US$13 million respectively, under the assumption that institutions would shift anywhere between 3 per cent and 19 per cent of their entire portfolios into Bitcoin in the years to come, all inspired by a convenient spot Bitcoin ETF. When institutions are able to invest in spot Bitcoin ETFs such as the iShares Bitcoin Trust – which has an expense ratio lower than many of its competitors – they’re finding a reason to buy Bitcoin more and more frequently (as reflected by the growing accumulation by around 600 institutional shareholders).
Yet investors are warned that they should ignore rosy projections since Bitcoin is a highly volatile investment with no guarantee of future value. It has experienced large price falls in the past, and there are risks that it might drop in value substantially or even to zero. Buyers should be prepared for total loss. This is, after all, speculation, even in more accessible instruments such as ETFs.
Source: Yahoo! Finance