Arch Invest CEO Cathy Wood believes that bitcoin’s rally amid the recent banking crisis will only “attract more institutions.”
in March 21 Interview Along with Bloomberg, Wood said that bitcoin’s price action through the crisis is “going to attract more institutions.” He claimed that this could help build a bull case for the leading cryptocurrency to rise to around $500,000.
She noted that during a banking crisis, liquidity runs out, which usually leads to asset losses. “The fact that bitcoin moved very differently from the equity markets, in particular, was quite instructive,” he said.
He added that corporate treasuries were previously shying away from holding bitcoin on their balance sheets because regulators themselves were pressuring them to divest.
According to data from CoinGecko, bitcoin is up more than 27% over the past two weeks. This is despite the recent turmoil in the US banking sector, which saw three major banks collapse in one week.
In a note to investors, Arch Invest argued that the rally is a sign of bitcoin’s value as a safe haven asset. Yasin Elmandjra of Arc Invest wrote In the firm’s weekly newsletter:
“In the face of US and European banking crises, bitcoin price growth shows that regulatory oversight has had little to no impact on the decentralized, transparent and auditable crypto asset ecosystem.”
“Last weekend, when many banks were closed, and others were facing a bank run, bitcoin didn’t miss a beat: it settled ~$33 billion, facilitated ~600k transactions, stabilized and projected a ~1.8% inflation rate. issued 2,037 new BTC, attracted ~1 million new addresses, and generated $43 million for the miners securing the network,” Elmandjra added.
Arch Invest Remains Bullish On Crypto
Arc is invested bullish on crypto Despite the recent crypto meltdown and increase in regulatory scrutiny. Recently the company raised over $16 million For two new private crypto funds.
The investment management firm is also interested in shares of major US-based cryptocurrency exchange Coinbase. Last week, Cathy Wood added 301,437 shares of Coinbase to her ARK Innovation ETF (ARKK) and 52,525 shares to the Next Generation Internet ETF (ARKW).
The move comes after the fund bought 333,637 shares in January. With this latest purchase, Arch owns 9.9 million Coinbase shares, or approximately 3.8% of the company.
Wood’s infamous prediction that bitcoin will reach $500,000 by 2030 has been a major talking point during the recent recession.
Earlier this year, he reiterated that he expects bitcoin to reach $500,000. “Yeah, we’re a little bit higher than that in our bearish case for 2030,” she said, noting that her bullish case is much higher.
During a recent interview, Wood explained that this price target was created based on an institutional investor BTC allocation analysis, which estimated that most companies would allocate between 2.5% and 6.5% of their investment portfolios to BTC.
“These are the types of allocations they would have made to emerging, new asset classes like real estate in the 70s and small caps in the 80s and 90s,” Wood said.