Bitcoin could rise to a market capitalization of USD 5,000,000,000 according to an investment firm

Bitcoin (BTC) Course Rocket

An investment firm that predicted Tesla’s meteoric rise, among other things, is extremely optimistic about Bitcoin and says the market capitalization of the crypto currency could rise to as much as USD 5,000,000,000,000 (trillions).

In a comprehensive report, the New York-based investment firm ARK Invest sees massive growth potential for Bitcoin in the coming years, despite the already impressive development that contradicts the expectations of many.

Our analysis indicates that Bitcoin is in an early stage of monetization and has significant potential for value enhancement. In our view, Bitcoin’s $200 billion market capitalization – or network value – will reach more than a trillion dollars over the next decade.

In particular, ARK Invest points out that the introduction of Bitcoin has the potential as a global settlement network, as a protection against censorship and confiscation of assets, as digital gold or as a catalyst for currency devaluation in emerging markets, to promote the growth of the overall market capitalization of crypto currencies.

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Massive potential despite some risks with Bitcoin

Despite its high valuation of the Crypto asset, ARK Invest points out the various risks that threaten the growth potential of Bitcoin.

On the one hand, the investment firm says that security breaches and institutional mismanagement have already cost investors millions of USD without any legal recourse. Other risks include regulatory uncertainty and „over-institutionalization“ which, according to the company, could lead to a monopoly in Bitcoin transactions and pose an „existential risk to the value proposition of Bitcoin.

Although risks exist, ARK Invest highlights the potential of BTC and describes the massive profits the asset could generate within a decade:

Bitcoin offers one of the most compelling risk-return profiles among assets, since according to our analysis it is expected to grow from today’s $200 billion to a network capitalization of $1 to 5 trillion over the next five to ten years. In our view, capital allocators need to take into account the opportunity cost of ignoring Bitcoin as a new asset class.