Cathie Wood Is Doubling Down on Her Bullish $1 Million-Plus Bitcoin Price Target. Here's Why.

In 2024, Bitcoin (CRYPTO: BTC) soared past the $100,000 mark for the first time in its history. But that may just be a stepping stone to its ultimate destination: the $1 million price level.

According to Cathie Wood of Ark Invest, Bitcoin is now on pace to hit the $1 million price point by the year 2030. In fact, if everything goes according to plan, Bitcoin might actually reach the $1.5 million price point. That might sound like a pie-in-the-sky prediction, but there are actually three very good reasons why it could end up happening.

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1. Growing institutional adoption

The biggest reason for optimism, says Cathie Wood, is growing institutional adoption of Bitcoin. There is now a realization among the world's largest institutional investors that Bitcoin is a stand-alone asset class that they need to add to their portfolios. With the launch of the new spot Bitcoin ETFs in 2024, they now have an easy way to gain access to this asset class.

The easiest way to measure the level of institutional adoption is by checking out how much capital investors are allocating to Bitcoin. At one time, allocating even 1% of a portfolio to Bitcoin was considered highly risky and highly speculative. But, as BlackRock recently pointed out, 2% is the new 1%.

And over time, Cathie Wood of Ark Invest expects this number to move even higher. In her Bitcoin valuation model, she currently projects institutional investors will allocate 6.5% of their portfolios to Bitcoin by the year 2030. That's based on the fact that Bitcoin's infamous volatility is beginning to decline, while its risk-adjusted returns still surpass those of every other asset class. That makes for a very attractive value proposition for institutional investors.

2. Integration into the global monetary system

Another huge factor in Bitcoin's ascent to the $100,000 price point has been its growing integration into the global monetary system. After all, it's not just institutional investors that are embracing Bitcoin. Central banks and sovereign governments are starting to hold Bitcoin as well. In some cases, they are even exploring the use of Bitcoin as an alternative to their national currencies.

Image source: Getty Images.

As a result, Cathie Wood's Bitcoin valuation model also includes assumptions about its continued integration into the global financial system. She assumes that central banks will increasingly buy Bitcoin as a form of "digital gold," and that nation-state treasuries will begin to accumulate Bitcoin for strategic purposes. And she assumes that publicly traded corporations will begin to hold Bitcoin on their balance sheets.

Admittedly, back in 2023, none of this really seemed possible. At that time, Bitcoin was just emerging from a long "crypto winter," and there was very little risk appetite for crypto assets. Bitcoin had just lost more than 65% of its value, and the whole "Bitcoin is a great long-term store of value" argument seemed to be in tatters.

But fast-forward to 2025, and the entire playing field seems to have tilted in Bitcoin's favor. MicroStrategy is paving the way for other corporations to hold massive amounts of Bitcoin on their balance sheets. The U.S. government is seriously contemplating the creation of a strategic Bitcoin reserve. And across the world, sovereign governments are putting into place new crypto asset frameworks that will help to ensure Bitcoin's further integration into the modern global financial system.

3. Bitcoin's improving network fundamentals

In her "Big Ideas 2025" report, Cathie Wood also details the growing strength and resilience of the Bitcoin blockchain network. Transaction activity and computer hash rates are both at an all-time high, and the number of long-term holders of Bitcoin (defined as those holding Bitcoin for three or more years) is also at an all-time high. In short, Bitcoin is firing on all cylinders right now.

Bitcoin's supporters have always pointed to Bitcoin as a form of "sound money" that is much more attractive than "unsound money" (i.e., fiat currencies issued by sovereign governments). And now this argument is starting to gain traction with billionaire hedge fund investors and top money managers. Listen carefully, and you'll hear them talk about Bitcoin as a "safe-haven asset" that can protect them from hyperinflation, currency devaluation, and other economic risks.

What is the likelihood of Bitcoin hitting $1 million?

Just keep in mind that the $1.5 million price target is a bull-case scenario. It's the price Bitcoin could hit if everything goes exactly according to plan over the next five years.

According to Cathie Wood, there are two other scenarios that are important to consider: the base-case scenario and the bear-case scenario. In a base-case scenario, Bitcoin only hits $710,000. And in a bear-case scenario, Bitcoin only hits $300,000.

Let's assume that Bitcoin overpromises and underdelivers, and only hits a price of $300,000. Based on Bitcoin's current price of $100,000, you're still tripling your original investment by the year 2030! That's not too shabby. If Cathie Wood is right, investing in Bitcoin now could be one of the best moves you make this year.

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Dominic Basulto has positions in Bitcoin. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.