ARK’s Cathie Wood Says Banking Crisis Will Attract More Insitutions To Bitcoin

By Kevin • March 26, 2023 10:49 am • Comments

ARK Invest CEO Cathie Wood just shared here recent thoughts on the recent banking crisis and how it will affect the rest of the crypto indsutry.

Essentially, Wood states that this event will only attract more insitutions to BTC over time as it becomes a more attractive alternative to be used as a storage for wealth.

It seems investors and speculators all are starting to believe that BTC is formidable as a secondary option to gold with it being named as “digital gold”.

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The key indicator during the past month that Wood wanted to highlight was how different the price trajectory of Bitcoin was compared to equity markets.

Typically, BTC is correlated with equity markets, but this was one of the first times where we saw a decorrelation in price which means major things are changing.

CoinTelegraph reports:

Institutional interest in Bitcoin may have already arrived, according to Oliver Linch, the CEO of Seattle-based crypto exchange Bittrex.

Linch noted in a March 21 interview on The Wolf Of All Streets podcast that many big banks bought into crypto as an investment product well before the recent banking crisis:

“The big talking point of this bear market is institutional interest in crypto. Every big bank now has a substantive crypto desk, not just for trading, but for partnerships as well.”

However, he said that there’s still a divide between traditional financial institutions and crypto firms, which has caused headwinds in institutional adoption over the last few months.

This institutional shift that is happening is key because it has been revealed that institutional commitment is always the biggest driver for innovation.

ARK has made a price prediction where BTC will reach the price of $1-$1.5 million by 2030 which is quite the optimistic prediction.

Apparently,  that prediction was made by using data and predictions on how much capital insitutions would use to allocate to BTC and assumes that it would be from 2.5% to 6.5% of their overall portfolios.

Surprisingly, that is not a super large allocation to BTC and even that alone would be enough to make ARK’s optimistic price prediction come true.

Add to the fact that there are inflation concerns for the future and the prediction seems more likely as time goes on.

Barrons.com reports:

Wood is one of the biggest crypto bulls on Wall Street. In a recent ARK report, she predicted that Bitcoin’s price would hit $1.5 million by 2030. When the report was published eight weeks ago, the digital currency was trading around $24,000, and has since increased to $28,000.

The recent rout in digital assets isn’t fazing Wood, because the troubles mostly stem from crypto-related institutions, she says, and not the technology itself. The underlying networks “didn’t skip a beat” during the crypto industry’s recent turmoil, she says.

Wood’s conviction in innovation and growth stocks is unwavering as well. As inflation crept up and the Fed started raising rates last year, growth stocks—with lofty valuations and the depreciation of future cash flows—turned out of favor, sending ARK funds tumbling. Over the past two years, the firm’s eight U.S.-listed ETFs have lost an average of 53%.

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