What underpins Bitwise’s view that Bitcoin could reach $1.6M by 2036?

• Bitcoin's 10-year price target from Bitwise now stands at $1.6 million, compared with $1.3 million a year earlier.
• Potential Bitcoin demand of $1.5 trillion to $7.4 trillion could emerge if institutional investors allocate 1-5% of the $147 trillion in assets they control.
• The scarcity case for Bitcoin is set to strengthen, with annual supply inflation projected to decline to 0.4% in 2028 and 0.2% in 2032.

Demand from institutions, constrained supply and mounting concerns about currency devaluation could propel Bitcoin (BTC) to $1.6 million by 2036, according to asset manager Bitwise.

Can Bitcoin reach $1.6 million within the next decade?

An annualised Bitcoin return of 34.3% over the coming decade was projected in the company's Bitcoin Long-Term Capital Market Assumptions report on Wednesday. Its earlier forecast had put Bitcoin at $1.3 million by 2035, implying an annualised return of 28.3%; the latest projection raises that outlook.

Bitwise wrote: "We believe that Bitcoin will be the best-performing major asset in the world over the next decade,"

With substantial scope for large investors to add Bitcoin to their holdings, institutional adoption forms a central pillar of the report's bullish view. According to Bitwise, institutions oversee roughly $147 trillion in assets, yet most have no allocation to Bitcoin.

Over the coming decade, allocations of between 1% and 5% of these investors' portfolios are expected by the firm, potentially translating into Bitcoin demand of $1.5 trillion to $7.4 trillion.

Less than three years since launch, US spot Bitcoin exchange-traded products (ETPs) have accumulated $108 billion in assets, Bitwise noted. As wealth management platforms widen access to Bitcoin products, the firm expects institutional inflows to gather pace from 2027.

How does Bitcoin's supply limit support its outlook?

A further pillar of Bitwise's valuation case is Bitcoin's fixed supply. Approximately 20.1 million BTC are already circulating, against a maximum supply of 21 million BTC for the leading cryptocurrency.

Under Bitcoin's predetermined issuance schedule, annual supply inflation is expected to decline from the report's stated rate of 0.8% to 0.4% in 2028 and 0.2% in 2032. Gold, in comparison, has an annual inflation rate of approximately 2%.

Bitwise stated: "Importantly, Bitcoin’s supply is inelastic: No amount of demand for Bitcoin or change in its price will cause more Bitcoin to be produced,"

Because supply cannot increase in response, stronger demand could lift Bitcoin's price, the firm argued.

Could growing government debt drive Bitcoin demand?

Concerns over fiat currency devaluation, together with mounting government debt, could underpin Bitcoin's long-term value, Bitwise added.

Annual interest payments stood at $1.1 trillion as US federal debt reached $40.2 trillion in September 2026, according to the report. Rising debt burdens are expected by Bitwise to put governments under greater pressure, potentially prompting investors to look beyond traditional currencies.

In the firm's view, Bitcoin stands to benefit as the store-of-value market expands and as it captures a greater share of that market.

The valuation model offers no guarantee of future results, however, Bitwise cautioned. Regulatory and government risks could challenge its long-term forecast, as could technological threats such as quantum computing and AI-driven advances in mathematics.