Cathie Wood, the CEO of Ark Funds, has been known to make certain forward-looking statements that have been roundly condemned. Wood and her colleagues have some of the most aggressive price predictions for Bitcoin BTC on Wall Street, with some of the highest price expectations in the industry.
An analysis of how much an investment may be valued in the future if their price goals are met is shown below.
This Is What Happened: "We are quite enthusiastic about Bitcoin in particular," Wood said last year, setting a price forecast of $400,000 for the cryptocurrency.
The bull thesis is supported by increased institutional interest in purchasing Bitcoin. Wood cited corporations such as Tesla Inc. TSLA, Block Inc. SQ, and MicroStrategy Inc. MSTR as examples of companies that have included Bitcoin on their balance sheets.
"Can you tell me why you don't want to diversify?" Wood was the one who inquired. If all firms invested 1 percent to 10 percent of their cash balances in Bitcoin, the coin's value might climb dramatically, allowing the price objective for the currency to be raised even higher.
A little later in the year 2021, Wood and Ark Funds began talking about a price objective of $500,000 for Bitcoin over the following five years. ARK analyst Yassine Elmandjra said in a recent research that Bitcoin's market valuation might expand by a factor of 25 in the next decade, reaching $28.5 trillion.
Ark Funds has set a $1 million price objective for gold by 2030, and the demand for a gain in addition to increasing share in comparison to gold serves to emphasize this goal.
What It Means and Why It Matters: Ark Funds has maintained its positive stance on Bitcoin, and the cryptocurrency continues to be a popular holding for the company's exchange-traded funds (ETFs) via investments in firms that have exposure to the commodity.
Tesla is a top holding in a number of mutual funds. The Grayscale Bitcoin Trust GBTC, with a stake of 7.2 percent in the Ark Next Generation Internet ETF ARKW, is the third biggest holding in the ETF.
Coinbase Global Inc COIN is the sixth biggest position in the Ark Innovation ETF ARKK, accounting for 5.4 percent of the total holdings. At 8.1 percent, Coinbase is also the biggest position in the Ark Next Generation ETF, and at 9.6 percent, Coinbase is the second largest holding in the Ark Fintech ETF, both of which are also held by the Ark Group.
One of Wood's most infamous forward-looking price projections ended up coming true, proving the doubters wrong in the process. Wood forecasted in 2018 that Tesla's stock would reach $4,000, which at the time was one of the most ambitious public projections available. In January 2021, Tesla stock reached a split-adjusted price of $4,000 per share.
Investing $100 in Bitcoin: If the price projections made by Cathie Wood and Ark Funds come true, a $100 investment in Bitcoin today might turn out to be a lucrative investment in the future, according to Cathie Wood.
Based on the current Bitcoin price of $43760.46 at the time of writing, a $100 investment can be used to acquire 0.002285 Bitcoin.
According to the price estimates from Ark Funds, the $100 investment would be worth the following:
- $914 for $400,000
- $1,142.50 for every dollar beyond $500.00
- $1,000,000: $2,285 dollars
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