The cryptocurrency sector could experience significant growth, with industry leaders forecasting bitcoin to reach a value of US$100,000 within the next five years, the Australian Financial Review reports.
This bullish outlook hinges on the approval of the first exchange-traded funds (ETFs) for digital assets, which could attract considerable institutional investment.
Lisa Wade, chief executive of DigitalX, said her team's "really grounded" analysis suggests bitcoin will likely hit the six-figure mark in US dollars in the near future.
"If just 1% of all global wealth was put into bitcoin, that gets us to US$100,000 within five years," Wade told The Australian Financial Review Cryptocurrency Summit.
Growing interest from institutional and sophisticated investors
Richard Galvin, chief executive and co-founder of Digital Asset Capital Management (DACM), also projects a bitcoin value of US$101,000 in the same time frame.
Galvin highlighted the growing interest from institutional and sophisticated investors, saying the company only deals "with wholesale, sophisticated investors and the vast majority are coming from overseas".
Current data from the Australian Tax Office indicates that more than A$950 million is allocated to cryptocurrencies in self-managed superannuation funds.
Both Wade and Galvin see the potential approval of cryptocurrency ETFs by global institutions as a catalyst for industry growth.
Firms like BlackRock, Fidelity, Ark Invest, VanEck, JPMorgan and BetaShares have expressed their intentions to US regulators to operate ETFs tracking bitcoin's price.
Potential industry milestone
Vimal Gor, who joined alternative fund manager Trovio in 2022, emphasised the speed of institutional adoption once a bitcoin ETF is launched.
"I'm a strong believer that institutional adoption and retail adoption will happen a lot quicker when an ETF comes and I think that will turbocharge the whole space," he said.
Jeff Yew, chief executive of crypto asset manager Monochrome, also underscored the increasing institutional interest in cryptocurrencies.
He is closely watching January 10, the final deadline for the US Securities and Exchange Commission to review ARK’s ETF application, as a potential industry milestone.