After surging to new all-time highs in 2025, the cryptocurrency market has cooled significantly in 2026. The CoinMarketCap 20 Index is down more than 30% since it was established as a way to track the 20 largest cryptocurrencies last November. But those wild swings are the price crypto investors pay in exchange for the potential of outstanding long-term returns.
Right now could be a great buying opportunity for investors, and one analyst sees a leading cryptocurrency climbing more than 1,300% from its current price within the next decade. Bitwise Chief Investment Officer Matt Hougan thinks Bitcoin (BTC +4.66%) can reach $1 million based on "reasonably conservative assumptions."
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Bitcoin's main use case
When Bitcoin was first developed, it was seen as a sort of digital cash. It had several advantages over actual cash or the traditional banking system, and the invention of the blockchain solved the challenges faced by previous digital cash implementations. But newer cryptocurrencies built on the blockchain technology introduced with Bitcoin are much better for actual transactions and contracts these days.
Bitcoin's best use now, Hougan argues, is as a store of value similar to gold. That's why many now call it digital gold instead of digital cash.
Hougan says that determining the value of Bitcoin is simple. If you can estimate the size of the market for store-of-value assets and Bitcoin's share of that market, you can get the total market cap of Bitcoin. Divide that by 21 million, the terminal supply of Bitcoin, and that's your price per coin.
Hougan points out the market is worth just under $38 trillion today, with $36 trillion of that held in gold. But he expects the total market to expand to about $121 trillion in 10 years. That's based on gold's historical returns since 2004. At that level, Bitcoin would need to capture just 17% of the total store-of-value market for coin prices to reach $1 million.
CRYPTO: BTC
Key Data Points
In fact, it might not even need to capture that much. For one, not every Bitcoin will be mined until around 2140. Only 20 million coins are in circulation today. The bigger factor may be that the liquidity of Bitcoin is much smaller than the supply, which could push prices higher.
Still, Hougan's thesis relies on two key factors: that the store-of-value market will grow at the same rate as for the past 21 years, and that Bitcoin will increase its share of that market from 4% to 17%. How "reasonably conservative" are those two assumptions?
Can Bitcoin really hit $1 million?
While it's true gold has produced excellent returns over the past 20 years or so, there's no guarantee the next 10 years will look anything like recent history. Gold has been on a tremendous run over the past couple of years, which has considerably boosted its 21-year historical returns.
In fact, if you look at gold's average annual return from the start of 2005 through the end of 2023, its average return drops to just 8%. But it more than doubled from the start of 2024 to the end of 2025.
Gold returns could be setting up for a big reversion to the mean. After the bull run that doubled gold prices between 2007 and 2011, gold produced negative returns for investors over the next decade. As such, investors may want to lower their expectations for the growth in the store-of-value market over the next decade.
What's more, it remains to be seen whether Bitcoin is widely seen as a store of value, as Hougan suggests. If it were, Bitcoin should be correlated with the price of gold. However, the two have moved in largely opposite directions since the start of 2025. As such, investing purely on the store-of-value thesis carries significant risks that the market may not agree with the core premise.
That said, there are reasons to be bullish on Bitcoin demand over the next decade. Bitcoin ETFs have proved extremely popular, with wide adoption among institutional investors. Some see it as a valuable diversifying asset that could garner an allocation of up to 5% for some investors. Quarterly 13F filings with the SEC disclosing the portfolios of money managers with more than $100 million in assets show 1,780 funds holding the iShare Bitcoin Trust ETF (IBIT +4.23%), up from 443 the quarter it launched.
So while demand for Bitcoin might not be increasing because it's seen as a great store of value like gold, it could increase because it's a great diversifying asset for stocks and bonds like gold. That could send Bitcoin significantly higher over the next decade, but not necessarily for the reasons Hougan suggests.
