Summary:
• Analyst Willy Woo predicts that there will be 1 billion Bitcoin holders by 2025, with a growth trajectory expected to surpass that of the early internet.
• Institutional demand and the success of spot bitcoin ETFs bode well for an impending sell-side liquidity crisis as supply tightens.
• Adam Back noted the high expectations for Bitcoin in the market, with the price expected to soar above current levels.
Bitcoin, the frontrunner in the cryptocurrency industry, is expected to grow exponentially in its adoption.
According to renowned analyst Willy Woo, Bitcoin is on the verge of a major leap forward that is expected to match the trajectory of internet growth from 1997 to 2005.
What it means to be a billion bitcoin holders
Woo believes this upheaval in adoption has been years in the making. As a result, “at the end of this cycle, there will be 1 billion people owning Bitcoin,” Woo asserts. He highlighted the accelerated adoption of this digital currency, which outpaced the speed of the early internet.
Given the growing global acceptance of Bitcoin, cryptographer Adam Back said the market is aiming for a more lofty goal, believing that $100,000 is seen as “long overdue.”
“Bitcoin hit $73,000 on Tuesday,” Back said. No one said anything. It was above $73,000 for most of Wednesday. I think the reason for the lackluster market reaction is that $100,000 seems long overdue. This expectation has been going on for several years, so when the $1,000 to $5,000 green candle rolls, it doesn’t generate much bullish frenzy. ”
Interestingly, the catalyst for this Bitcoin price prediction is largely attributed to institutional demand.
As Ki Young Ju, CEO of CryptoQuant, points out, if institutional funding continues to flow in, then a “sell-side liquidity crisis” is coming. This surge in demand, combined with the successful launch of spot Bitcoin exchange-traded funds (ETFs) in the US, confirms that Bitcoin is a viable institutional investment and introduces a paradigm where demand outstrips supply.
In fact, the launch of spot bitcoin ETFs marks them as the most successful ETF in history, with a cumulative size of nearly $30 billion. As Ki elaborates, this inflow could trigger a price shock for the amount of supply. In this case, the available bitcoins cannot meet the growing demand.
Last week, more than 30,000 BTC was net inflows into spot ETFs, further exacerbating the potential liquidity crisis.
In addition, Ki’s analysis revealed the growth of Bitcoin cumulative addresses, a cumulative upward trend of wallets that only receive transactions, indicating the growth of hoarding behavior. If this continues, it could signal the beginning of a sell-side liquidity crunch.
As Bitcoin’s adoption curve rises sharply towards the 1 billion mark, the interplay between surging demand from institutional investors, in particular, and dwindling supply, could catalyze an unprecedented price impact.