Institutional investors could channel trillions of dollars into Bitcoin over the coming decade as the cryptocurrency solidifies its position as a mainstream portfolio asset, according to Matt Hougan, Chief Investment Officer at Bitwise, a crypto-focused asset manager and one of the firms that launched a U.S. spot Bitcoin ETF in January 2024. Hougan contends that even a modest allocation from the world's largest pools of capital would be sufficient to materially reshape the market.

Hougan estimates that global institutions collectively control between $100 trillion and $200 trillion in assets. A 1% allocation to Bitcoin from that base would translate into inflows of $1 trillion to $2 trillion.

The calculation, as Hougan presents it:

• Global institutional assets: $100 trillion–$200 trillion
• Assumed Bitcoin allocation: 1%
• Potential Bitcoin inflows: $1 trillion–$2 trillion

To put that figure in perspective, Bitcoin's total market capitalization currently sits below $2 trillion—meaning the inflows Hougan describes would dwarf the cryptocurrency's entire present valuation. Hougan noted that institutional demand of that magnitude would underpin his long-term Bitcoin thesis, though he expects the transition to span well over a decade.

"It's a process that will take 10+ years," Hougan said.

A $1.3 Million Price Target Anchored in Store-of-Value Math

Hougan's $1.3 million Bitcoin price target for 2035 rests on a separate store-of-value framework. He argues that Bitcoin will increasingly compete with gold and other assets used to preserve wealth, and estimates that the global store-of-value market will continue expanding at its historical rate of approximately 13% per year.

According to Hougan, gold's market capitalization has grown from roughly $2 trillion in 2004—the year gold exchange-traded funds launched—to approximately $30 trillion today. If that market continues to grow at 13% annually for another decade, its value would rise substantially. Under Hougan's model, Bitcoin capturing 25% of that expanded store-of-value market would put the price of each Bitcoin at roughly $1.3 million by 2035.

For context, gold's decades-long growth trajectory was propelled in part by the introduction of ETFs that made the metal accessible to mainstream investors—a parallel Hougan implicitly draws as spot Bitcoin ETFs now provide a similar on-ramp for digital assets.

Why Institutions, Not Corporations, Lead the Next Phase

Hougan's framework also explains why he expects institutional capital—rather than corporate buyers—to become the next major driver of Bitcoin demand. Financial advisers and family offices are likely to be among the first professional investors to increase their allocations, he said, followed over time by foundations, endowments, pension funds, insurers, sovereign wealth funds, and ultimately central banks.

Evidence of this shift is already visible, Hougan noted, pointing to regulatory filings showing exposure to spot Bitcoin ETFs—the regulated investment vehicles whose January 2024 approval by the SEC gave institutions a familiar wrapper for Bitcoin exposure without the operational burdens of direct custody. Major wealth managers, including Morgan Stanley and Wells Fargo, have expanded client access to Bitcoin products.

"Institutions have most of the money in the world," Hougan said. "Crypto grew up in retail, which took it from $0 to $2 trillion. But if it wants to get from $2 trillion to $20 trillion, it's going to be institutional capital that leads the way."

Strategy's Role as Incremental Buyer Set to Diminish

Hougan also expects Strategy, one of the largest corporate holders of Bitcoin, to become a less significant source of incremental demand going forward. Strategy—the software firm formerly known as MicroStrategy—built its position by issuing shares at a premium to the underlying value of its Bitcoin holdings and raising additional capital through convertible debt and preferred-stock offerings.

However, the launch of spot Bitcoin ETFs has eroded the scarcity value of Strategy's stock as a vehicle for public-market Bitcoin exposure. At the same time, the company's capacity to raise additional debt has become more constrained.

"The easy paths to accumulation have been exhausted," Hougan said.

Strategy is likely to continue purchasing Bitcoin, Hougan added, but at a reduced pace and with acquisitions more closely tied to the cryptocurrency's price cycle.

For Hougan, the central question facing Bitcoin investors is whether the market's long-term institutional adoption cycle remains in its early stages—rather than whether prices have simply reached a short-term bottom.