Bitcoin could still be on track for another explosive bull market, but reaching new highs may require an unprecedented wave of institutional investment, according to CryptoQuant CEO Ki Young Ju.
In a recent analysis, Ju explained that Bitcoin’s ability to generate outsized returns from new capital has weakened significantly as the asset has grown into a trillion dollar market.
During Bitcoin’s early years, relatively modest inflows were enough to trigger massive price rallies. In 2011, an estimated $2.7 billion in net capital inflows helped fuel a gain of more than 55,000 percent. By comparison, the current market cycle has attracted roughly $697 billion in new capital, yet Bitcoin has delivered a return of less than 700 percent.
The message is clear. As Bitcoin’s market value expands, much larger amounts of money are required to move its price.
The Next Rally Could Require Trillions
Ju noted that Bitcoin’s capital requirements have increased dramatically over time. In 2011, just $5 million in net inflows was enough to double the asset’s price. Today, achieving a similar move would require close to $101 billion in fresh capital.
Based on that trend, he believes the next major parabolic rally may depend on trillions of dollars flowing into Bitcoin.
That does not mean another bull market is out of reach. Instead, it suggests that institutional investors will likely play a much bigger role than they did during previous market cycles.
Ju also pointed to Bitcoin’s realized capitalization, a metric that values each coin according to the price at which it last moved on chain rather than its current market price.
According to him, if Bitcoin’s realized capitalization can absorb more than $1 trillion in new value, another significant rally remains possible. However, achieving that milestone would require Bitcoin to evolve beyond a retail driven ETF narrative and become a core portfolio allocation for investment funds, corporations, financial institutions, and potentially even sovereign wealth entities.
He added that this transition is still in its early stages and there is no indication that the long term thesis has been invalidated.
Gold Still Sets the Benchmark
Bitcoin’s long term growth story continues to be measured against gold.
The precious metal is currently valued at around $29 trillion based on widely accepted estimates, although that figure can vary depending on calculations of the total above ground supply. In comparison, Bitcoin’s market capitalization stands at roughly $1.25 trillion.
The substantial gap between the two assets is one reason many analysts believe Bitcoin still has significant room for growth as institutional adoption continues to accelerate. At the same time, it highlights an important reality. Every future bull market is likely to demand increasingly larger pools of capital than the one before.#crypto#cryptonews https://coinsignals.net https://t.me/coinsignalpublic
