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Released on Thursday, the latest report levels up Ark’s previous price predictions from its annual Big Ideas report, which used total addressable markets (TAM) and penetration rate assumptions to determine a price prediction for Bitcoin.
Now, the firm combined its previous predictions with experimental modeling that considers Bitcoin’s “active” supply—which discounts lost or long-held coins.
“Bitcoin’s network liveliness has remained near ~60% since early 2018. In our view, that magnitude of liveliness suggests that ~40% of supply is ‘vaulted,’” the report reads. “On that basis, we arrive at the following price targets, which are roughly 40% higher than our base model, which does not account for Bitcoin active supply and network liveliness”
When accounting for active supply, Ark Invest predicts a bear case—or the most negative view—of around $500,000 per BTC. The bull case? A Bitcoin price of $2.4 million per coin.
Contributing to its potential growth, the report highlights the major inputs for its TAM and penetration rate data, which include its standing as a “digital gold,” institutional investment in spot ETFs, emerging market investors seeking a safe haven asset, and corporate treasuries continuing to diversify with Bitcoin.
Ark is not the only Bitcoin proponent to suggest a price appreciation above $1 million per coin. In September Strategy Chairman and co-founder Michael Saylor predicted the leading crypto asset would reach $13 million per coin over the next 21 years. In January, Coinbase CEO Brian Armstrong said he thinks it will reach the “multiple millions price range” as well.
Bitcoin topped $95,000 for the first time in two months earlier Friday, but still remains down from its all-time peak price of nearly $109,000 set in January.
Edited by Andrew Hayward