Fidelity issues report on how Bitcoin market could eclipse $1 trillion

Fidelity Digital Assets, which is the section of Fidelity that handles cryptocurrencies, recently issued a report that suggests that investors allocate 5% of their assets into Bitcoin. The report was very positive on crypto assets, and pointed out they have a low correlation with major asset classes. It also made the case for Bitcoin's market cap to rise above $1 trillion.

The report states,

“If bitcoin were to capture 5% of the alternatives market as measured by CAIA, that would equate to an incremental $670 billion growth in its market size. If it were to capture 10%, that would expand its market size by $1.3 trillion.”

Why it matters: Fidelity is one of the most influential investment companies in the USA, especially with retail investors. By advising that investors begin to look at Bitcoin as a staple portfolio asset, the company may set off a massive buying spree by long-term retail investors who won't care about Bitcoin prices, aside from rebalancing their holdings on a quarterly or yearly basis. The initial buying would drive prices up, and could attract even more attention for the sector. As the buyers would look at Bitcoin as a long-term hedging asset, falls in Bitcoin prices could actually drive more buying, as holdings were added to make up for losses in dollar value.

Subscribe to BTC Peers

Don’t miss out on the latest issues. Sign up now to get access to the library of members-only issues.
jamie@example.com
Subscribe