Fidelity Reveals How Bitcoin (BTC) Could Reach A $1.3 Billion Market Cap.
There have been all kinds of bullish predictions about the price of Bitcoin, and now, Fidelity addresses one such scenario.
The trillion-dollar asset manager just explained how Bitcoin (BTC) could reach a $1.3 billion market cap.
Bitcoin reaching $1.3 billion market cap
During a new report that’s been done in collab with some important investors from the industry, Fidelity said that Bitcoin‘s market cap could head straight to the moon if the asset is able to capture just a fraction of the alternative investment market.
“If bitcoin were to capture 5% of the alternatives market as measured by CAIA, that would equate to an incremental $670 billion growth in its market size. If it were to capture 10%, that would expand its market size by $1.3 trillion,” according to the notes, as cited by the online publication the Daily Hodl.
Fidelity said that the alternative investment market (which includes real estate, infrastructure, private equity, hedge funds, natural resources, private debt, and commodities derivatives) saw growth to $13.4 trillion to occupy 12% of the global investible market in 2018.
Fidelity also pointed out the fact that the Chartered Alternative Investment Analyst Association (CAIA) just predicted that alternatives would likely surge to 24% of the global investible market by 2025.
Fidelity addresses investors’ motivation to buy BTC
Fidelity also talked about the reasons for which investors are motivated to buy BTC.
“The rationale of certain bitcoin holders for allocating to bitcoin is similar to their rationale for allocating to alternative investments—notably, portfolio diversification and return enhancement,” according to the firm.
Fidelity continued and said that “Additionally, the interest in bitcoin and other non-yield-generating alternative investments could also increase in response to the Federal Reserve (and many other central banks) cutting their benchmark interest rate to zero (or below zero) this year. In a world where benchmark interest rates globally are near, at, or below zero, the opportunity cost of not allocating to bitcoin is higher.”
At the moment of writing this article, Bitcoin is trading in the green, and the king coin is priced at $11,418.68.
CoinMarketCap is a website that provides cryptocurrency market cap rankings, charts, and more. It was purchased by Binance for $400M in 2020.
Eduard Watson Author
An experienced finance writer for more than 10 years, active industry watcher, and gadget enthusiast.