Matt Hougan, Bitwise's Chief Investment Officer, evaluated the current market dynamics, noting the unprecedented demand for Bitcoin ETFs across various categories of investors.
“We are seeing tremendous demand for the Bitwise Bitcoin ETF and all of these ETFs,” Hougan said in a recent interview.
The rise in BTC price is attributed to a combination of retail investors, institutions, hedge funds and independent financial advisors flocking to the market via ETFs. Hougan emphasized the inclusive nature of ETFs and said:
“You see individual investors coming into these ETFs. You see hedge funds. You see traditional financial advisors or independent financial advisors.”
Analysts predict even more significant institutional participation in the coming months as major banks become interested in Bitcoin ETFs. Hougan likened this increase to Bitcoin's “IPO moment” and signaled a new era of price discovery for this cryptocurrency.
When asked about the split in ETF participation between individual and institutional investors, Hougan explained: “Initial demand for any ETF, including these, comes primarily from individual and independent financial advisors and hedge funds.” However, Hougan predicts a significant influx of institutional capital in the near future.
According to Hougan, the rise in Bitcoin's price is further fueled by a significant supply-demand imbalance:
“There are 30,000 Bitcoins purchased by ETFs this week alone. Bitcoin miners have only produced less than 3,000 BTC.”
This stark contrast underscores the overwhelming demand for Bitcoin compared to its limited supply, according to Hougan.
Hougan Targets $100,000 and Above in 2024 for Bitcoin Price
Looking ahead, Hougan revised Bitwise's 2024 forecasts, suggesting Bitcoin could reach its all-time high above $100,000 or even higher. He cited ongoing supply-demand dynamics and the expected reduction in new supply with the halving event in April.
Regarding the future state of Bitcoin ETFs, Hougan predicted that there will be some consolidation in the market and that six or seven dominant companies will survive in the long term. He highlighted the remarkable success of current ETF launches and said he expects more innovation in ETF offerings, such as covered call options.
*This is not investment advice.
