Why So Bearish? Fidelity Suggests Bitcoin Price Could Rise To $100 Million

Reynaldo Marquez

3 years ago

3 mins read

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Boston-based investment firm Fidelity presented one of the most bullish scenarios for the price of Bitcoin, Anthony Pompliano said in his podcast “The Best Business Show”. Based on the Stock-to-Flow model develop by analyst Plan B, BTC’s price could stand at $100 million by 2035.

With over $10.4 trillion in assets under management, Fidelity investment and its digital assets stand-alone company Fidelity Digital has been bullish on Bitcoin for a long time. The company started dabbing into the crypto space as early as 2014, Pompliano said, and started developing mining capabilities and BTC-based products.

The Bitcoin price prediction was presented during a Fidelity webinar called “Understanding Bitcoin, What Can History Teach Us?” by Jurrien Timmer, the firm’s Director of Macro. Timmer is a Bitcoin bull and has been making updates on BTC’s price via his Twitter account.

On several occasions, he has compared BTC with Gold in 1970. The chart below was shared by Timmer on August 20^th, showing the similarities between the cryptocurrency and the precious metal’s chart.

As the chart suggests, Bitcoin’s recent price action looks similar to that of Gold during that year. From this comparison and due to the growth in its fundamentals, Timmer believes BTC is “ready to resume its uptrend”.

The Stock-to-Flow model presented by Timmer predicts continues appreciation in BTC’s price due to a reduction in its annual inflation rate. By the end of the decade, when Bitcoin’s inflation rate will be around 0.5%, this model predicts that the cryptocurrency will be valued at $1,000,000.

5 years later, as the same metric drops to 0.2%, BTC’s price will stand at $100,000,000. As Pompliano said, it’s unclear if the investment firm believes the prediction will be fulfilled, but

(…) according to the Stock-to-Flow model, which they appear to be believers (…) that is what the Stock-to-Flow model will show. Fidelity, as they become more interested in Bitcoin, appear to become more and more bullish on the asset itself.

Bitcoin To Overshadow Gold’s Bull-Run In The Coming Decades?

In the 1970s, Pampliano said, the price of Gold stood at around $35. After the U.S. de-pegged its currency from the precious metal, embracing the Fiat Standard, Gold has risen to over $1,800.

This has been one of the most “incredible repricing” of an asset in the past 100 years. If the same were to occur with Bitcoin, the cryptocurrency could see a 2000x increase from its current value at $48,845, at the time of writing. Pompliano added:

(…) if they (Fidelity) are saying that basically we are in the 1970s of gold but for Bitcoin now, they are calling for a very very material increase in the price of Bitcoin. To see Fidelity, show a chart that says that Bitcoin is going to be at 100 million dollars by 2035 is very incredible (…).

Pompliano reiterated that the fact that Fidelity, one of the biggest investment firms in the world with a lot of time exploring BTC and the crypto market, is showing this model to clients it’s a positive signal.

The Stock-to-Flow model evaluates an asset to make a price prediction based on its supply/demand. The model has been applied to Gold, equities, and other assets and proven to be accurate.

Analyst Plan B was the first to apply this model to BTC and, according to recent updates, it has proven to be accurate. However, the model is controversial and has many detractors that believe that it won’t be successful due to BTC’s characteristics.

#Bitcoin August closing price $47,156 .. like clockwork pic.twitter.com/3hkp71FTXo

— PlanB (@100trillionUSD) September 1, 2021

At the time of writing, BTC displays strength in the daily chart as the bulls attack the resistance at current levels. A break above $48,500 could lead BTC’s price to the lows at $50,000.

Reynaldo Marquez

A literature major, Reynaldo Márquez has been deeply immersed in the crypto industry since 2017. His journey began with translating articles for various crypto news outlets, a role he took on with zeal. In 2018, amidst a challenging market, he embraced his first writing assignment, demonstrating his unwavering commitment to the nascent industry and the promise of change it bears for many people worldwide.
In March 2021, he joined the prestigious crypto news outlet NewsBTC and Bitcoinist, where he not only reported on the latest crypto news but also had the privilege of interviewing some of the industry's most influential figures. A year later, his dedication and hard work were recognized, and he was promoted to Managing Editor, a position he currently holds with pride.
He believes in honesty, good communication, hard work, and the power of cryptocurrency and its potential to transform people's lives, especially those alienated by the legacy financial system. Born in 1992 in Venezuela, Reynaldo is familiar with how governments and central banks can negatively affect people, their everyday lives, and their futures by creating inflation and erasing their hopes for a better future. Thus, like many Venezuelans, he embraced this new technology to help him and his family navigate difficult times.
In another life, Reynaldo would have pursued a career as an investigator, most likely tracking down the origins of the Cyberpunk movement with the publication of William Gibson’s ‘Neuromancer.’ The intersection between fiction and reality, with the materialization of Bitcoin in 2009, would have allowed him to dive deep into the crypto sphere as something more than a financial phenomenon but also a cultural shift in society that was brewing since the XX century, and maybe even sooner, in the XIX century with the publication of Henry David Thoreau’s ‘Civil Disobedience.’
But that’s for another life. In this one, Reynaldo has been trading to improve his trading skills. Since 2023, he has been trying to learn Python to create successful strategies and find ways to execute them. It is a difficult task, which continues to keep him busy today and will most likely continue to keep him busy in the near and long term.
In his free time, he enjoys lifting heavy objects, reading, watching movies, and listening to his favorite music. Some of his favorite authors are Walt Whitman, William Faulkner, Allen Ginsberg, James Baldwin, Raymond Carver, Ray Bradbury, George Orwell, Mario Vargas Llosa, Reinaldo Arenas, Rafael Cadenas, and many others. Lately, he has been primarily interested in reading about dystopic societies, a topic that deeply resonates with the crypto industry.
Since 2023, he has lived in Spain with his wife. He loves the weather, the food, and the people and their culture. They both expect to travel much more within the country they now call home and beyond its border. He hopes to retire with his wife, maybe in a quiet place near a beach, but most likely in a city close to a library and a university with his kids and, hopefully, grandkids.

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