Fundstrat predicts Bitcoin price will hit $500,000 in next five years

Market research firm Fundstrat expects Bitcoin (BTC) to reach $500,000 within the next five years, largely due to the approval of a Bitcoin spot ETF in the United States.

Fundstrat’s Tom Lee told CNBC on Wednesday:

“I think within the next five years, Bitcoin can reach about $500,000.”

What does Bitcoin ETF mean?

Lee maintained his previous prediction that Bitcoin could reach over $100,000 in 2024, and possibly even $150,000.

“Supply is limited, but with the adoption of spot Bitcoin, we have a huge increase in demand.”

Bitcoin experienced significant volatility on Tuesday after the U.S. Securities and Exchange Commission (SEC) issued a false tweet claiming that a spot ETF had been approved, sending the asset to multi-year highs of $47,900.

For months, industry leaders have predicted that ETF approval would open up a huge pool of institutional capital.

In November, former New York Stock Exchange chairman Tom Farley, who now leads his own cryptocurrency exchange, predicted that money would “flood” into Bitcoin once the ETF is approved.

A lot of money is about to pour into Bitcoin

Lee said the approval could create a generational divide in how investors treat Bitcoin.

While younger investors may prefer to have their money in physical wallets, those over 50 — who control 76% of total U.S. wealth ($120 trillion) — are likely to stay in public and authorized markets.

“There’s a generation that wants to allocate through a 401(k) or through open markets or liquid assets.”

The analyst previously predicted that the price of BTC would reach $180,000 by the time of the halving in April 2024, in anticipation that the ETF might be approved in the third quarter of last year.

Lee isn’t the only one making optimistic predictions about Bitcoin’s price. Bernstein analysts wrote in November that based on a theoretical four-year cycle, Bitcoin prices could reach $150,000 by mid-2025.

On Monday, Standard Chartered Bank released a report predicting that Bitcoin prices will reach $200,000 by the end of 2025, and ETFs are expected to earn $50 billion to $100 billion by the end of the year.

At the same time, April’s halving event is expected to cause a supply shortage of new coins, combining a supply shock with a demand shock from ETFs.