Big Ideas 2023 | Ark Invest: Bitcoin price expected to range between $250,000 and $1.48 million by 2030, depending on market conditions

ARK Invest, led by the renowned "Queen of Wall Street" Cathie Wood, released their annual research report yesterday – BIG IDEAS 2023, which covers research and predictions in areas such as digital consumption, smart contract networks, electric vehicles, and autonomous logistics. This translation focuses on the content related to Bitcoin in the report.

ARK 2023 Report Article List:
1. Big Ideas 2023 | Artificial intelligence is the most important catalyst for explosive growth, but has low correlation with blockchain
2. Big Ideas 2023 | Bitcoin price is projected to range from $250,000 to $1.48 million by 2030, depending on market conditions
3. Big Ideas 2023 | NFT trading volume to increase fivefold in five years, reaching $120 billion by 2027

Overview of Bitcoin's Current Situation and Future in Ten Charts

1. The current bear market retracement is the fifth largest and second longest in history

The lowest point of the current bear market, at $15,797, occurred in November of last year, representing a decline of approximately 76.7% from the peak of $69,000, lasting over 14 months. Based on data from the past four bear markets, the compound annual growth rate (CAGR) of the Bitcoin price exceeds 150% whether measured from peak to peak or trough to trough.

Note: Compound Annual Growth Rate refers to the annual growth rate of an investment over a specific period.

2. Despite significant retracements, Bitcoin's long-term performance remains superior to mainstream assets

Since 2009, Bitcoin has experienced five retracements of over 75% in price. However, when observing the historical compound annual growth rates over three, four, or five-year periods, Bitcoin's performance has been superior to global stocks, bonds, and gold, all of which have positive values.

The five-year compound annual growth rate in 2022 is the lowest to date at 8.7%, but still the highest among the four.

3. Bitcoin's fundamentals are more robust than in the past

Indicators such as realized market value, realized price, the proportion of long-term holders, and Lightning Network capacity all reflect that Bitcoin's fundamentals are significantly better compared to previous retracements.

4. Bitcoin investment losses hit a new high as prices fall

The Bitcoin trading loss ratio reached a new high of 68.3% in 2022, surpassing previous bear markets. Additionally, compared to 2021, realized gains from Bitcoin have decreased by 75%, while realized losses have increased by approximately 30%.

5. Increase in the proportion of long-term Bitcoin holders

Despite facing sharp price declines, the number of Bitcoins that have not moved for over six months continues to rise, with long-term holders owning 71% of circulating Bitcoins.

6. Investor trust in centralized crypto institutions declines as exchanges enhance asset transparency

In 2022, a record 560,000 Bitcoins flowed out of centralized exchanges, marking the highest outflow in history. Major exchanges are introducing Proof of Reserves (PoR) to regain investor trust.

7. Bitcoin hash rate continues to rise

The Bitcoin hash rate has been steadily increasing for 12 years, reaching a peak of 272 EH/s in 2022.

8. Bitcoin mining is an ideal choice for oil and gas well sites

Due to the modular hardware of Bitcoin mining, which is distributed and highly scalable, it can be transported to oil and gas well sites and moved between them. However, the limited lifespan of oil and gas wells may affect the return on investment for Bitcoin mining.

Furthermore, with the emergence of this type of mining, profits for independent miners may decrease.

9. Several institutions are still developing Bitcoin businesses during the bear market

Examples such as Ark's partnerships with investment management firm BlackRock, New York Mellon Bank, independent account provider Eaglebrook Advisors, and financial services company Fidelity launched last year indicate that institutions are still committed to developing Bitcoin-related businesses.

10. Bitcoin price expected to surpass one million US dollars by 2030

Compared to last year's Ark report, this time three Bitcoin price predictions are presented for different market scenarios. If 2023 is in a bear market, where Bitcoin's value mainly comes from digital gold and institutional investments, Ark estimates the price to reach $258,500.

Conversely, in a bull market, in addition to the factors mentioned earlier, there are also emerging market currencies and economic settlement networks, with Ark estimating the price to reach $1.48 million.