Bitcoin (CRYPTO: BTC) has experienced significant growth over the past decade, outperforming the stock market and increasing its price by 20,000% since September 2013. Looking ahead, there is a possibility that Bitcoin’s market cap could double by 2028, potentially making it a trillion-dollar asset. Institutions and major corporations have shown increased interest in Bitcoin, marking a shift from its early adoption by individuals. The potential approval of Bitcoin spot exchange-traded funds (ETFs) by asset managers like BlackRock and Fidelity could further legitimize Bitcoin as a financial asset. Clearer regulatory frameworks and reduced risk associated with owning Bitcoin would also contribute to its growth.
Bitcoin’s longevity and the absence of hacking incidents in its 14-year history add to its credibility. The longer Bitcoin remains relevant, the less likely it is to cease to exist, as suggested by the Lindy effect. However, investors should be prepared for volatility, as Bitcoin has experienced significant drawdowns in the past. Despite the associated risks, a 1% stake in Bitcoin could be considered as part of a well-diversified portfolio.
Overall, the potential doubling of Bitcoin’s market cap by 2028 depends on various factors, including the approval of spot ETFs and the establishment of clearer regulatory frameworks. Bitcoin’s growth would further solidify its position as a trillion-dollar asset and continue to attract interest from both institutional and individual investors. However, these investors must also be mindful of the volatility that accompanies Bitcoin and consider it as a portion of their overall investment strategy.
