An investment firm that foresaw the magnificent price rise of Tesla (TSLA) is also bullish on Bitcoin (BTC). It says that the first and largest cryptocurrency could reach $5 Trillion in terms of market capitalization.
In a report recently released, ARK Invest, an investment firm based in New York foresees the significant growth potential embedded in Bitcoin for the next couple of years:
“Our analysis suggests Bitcoin is early on its path to monetization, with substantial appreciation potential. In our view, Bitcoin’s $200 billion market capitalization – or network value – will scale more than an order of magnitude to the trillions during the next decade.”
According to ARK Invest, the adoption of Bitcoin as a global settlement network, as a protection against asset seizure, as digital gold, or as a catalyst for demonetization in emerging markets, is enough to boost the growth of Bitcoin’s market capitalization.
However, the investment firm tries to point out the shortcomings that are really threatening the growth potential of the leading cryptocurrency.
The firm says that security breaches and institutional mismanagement have made many investors lose a lot of their hard-earned funds without a clear legal resource.
Other risks mentioned by ARK Invest are the regulatory uncertainty and over-institutionalization that may greatly impact the proposition of the value of Bitcoin.
Despite the risks highlighted, the investment firm still emphasized the potential that would massively aid the bull run of the price of Bitcoin (BTC) within the next 10 years:
“Bitcoin offers one of the most compelling risk-reward profiles among assets, as our analysis suggests it should scale from roughly $200 billion today to $1-5 trillion network capitalization during the next five to ten years. In our view, capital allocators must consider the opportunity cost that will be associated with ignoring bitcoin as a new asset class.”
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