Cathie Wood, who is the CEO and chief investment officer of Ark Investment, made a prediction during an interview with Bloomberg, suggesting that Bitcoin will hit a price of $1 million by 2030.

In the conversation on Dec. 20, Cathie Wood pointed towards Bitcoin’s (BTC) fixed supply of 21 million cap as the key denominator which will drive the asset’s value. She brought to light the scarcity of BTC as more than 19.5 million BTCs have already been mined, which she says have increased the institutional investor’s hunger for the asset. 

“Bitcoin is really the first of a new asset class, and it will be the largest opportunity of them all,” Wood stated. As a result of this increasing institutional adoption and supply-demand dynamic, she argues that the likelihood of BTC reaching $1 million is now considerably higher. Referencing Ark Investment’s Big Ideas 2023 research report, Wood highlighted the asset’s inherent scarcity as a key driver of its growing demand.

Responding to criticism of BTC’s speculative character, Wood drew parallel to gold, with both acting as stores of value. Also, she noted that BTC’s annual supply growth rate has recently fallen to 0.9%, lower than gold’s long-term average supply growth rate of 1%, meaning that BTC is more scarce than gold.

Wood said that while gold could lead to increasing supply in a rising price environment, BTC cannot due to its decentralized mechanism. “Like gold, Bitcoin is secured by its scarcity, but unlike gold it’s backed by the largest computing system in the world, making it the most secure network in the world,” she explained. It is this mathematical scarcity along with its decentralized and rules-based design that differentiates BTC as a radically new era financial asset, Wood claimed.

Wood largely credits the sudden boom in digital asset adoption to the COVID-19 pandemic, which she says has “turbocharged” a period of financial self-education by younger investors whose personal standards for accreditation traditionally fall short. This change has been also documented  in statistics; where 63% of people invested in cryptocurrency in 2021 during the pandemic, with the bulk of adopters being millennials and Gen Z.