British multinational bank Standard Chartered predicts that Bitcoin (BTC) will reach $200,000 by the end of 2025 – a more than 300% increase from today's trading value.
The bank argued in a research note on Monday that Bitcoin spot ETFs – which are expected to be approved “soon” – could absorb $50 billion to $100 billion worth of inflows within a year.
The Upside Potential of Bitcoin ETFs
The bank based its inflow estimates on the performance of the first gold ETF, which entered the US market in November 2004.
The precious metal is often compared in financial circles to Bitcoin as a scarce form of money and a reliable store of value. As with the gold ETF, a Bitcoin equivalent would allow investors easy and familiar access to the asset's price without having to deal with the complexities of storing the asset themselves.
“The price of gold increased 4.3-fold in the seven to eight years it took for gold ETP holdings to mature after the launch of the first ETP,” said the bank's analysts, including the head of digital Asset Research, Geoff Kendrick, and precious metals analyst Suki Cooper.
The authors expect a Bitcoin ETF to trigger gains of the same magnitude, but over a shorter period of just one to two years, as the Bitcoin ETF market is expected to “evolve faster.”
According to the bank's assumptions, such inflows could drive the price of Bitcoin to “levels close to $200,000 by the end of 2025.”
“This assumes that between 437,000 and 1.37 million new Bitcoin will be held in spot US ETFs by the end of 2024,” the analysts continued. “In U.S. dollars, that’s probably around $50 billion to $100 billion.”
Countdown to Bitcoin ETFs
Last month, Standard Chartered estimated that BTC would reach $100,000 by the end of 2024, driven by both ETF approvals and the upcoming Bitcoin halving.
Nearly a dozen asset managers, including BlackRock, Fidelity and Ark Invest, are awaiting SEC approval of their ETF applications this week. The agency's final deadline to approve or deny Ark's application is Wednesday.
Almost all sponsors announced exceptionally low management fees for their products, signaling to some that their providers may have huge AUM expectations to sustain such low fees.
As ETF excitement builds, Bitcoin hit another multi-year high of $47,100 on Monday.
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