ARK Invest’s CEO, Cathie Wood, envisions a new era for Bitcoin where growing institutional involvement will help stabilize its price and reduce extreme downturns.
During an interview on the show ‘Mornings with Maria,’ Wood explained that Bitcoin’s evolution into a risk-on asset could disrupt its traditional four-year boom-and-bust cycle.
“We anticipate the four-year cycle to be broken,” Wood stated. “In its early years, Bitcoin often plummeted between 75% and 90%. Now, volatility has diminished significantly to roughly 30%.”
Wood highlighted that although Bitcoin has occasionally acted as a safe haven during crises like the European sovereign debt turmoil and US regional bank failures, it is increasingly behaving like a risk-on investment. She acknowledged concerns about recurring cyclical drops but believes institutional investors will help prevent severe price crashes.
“It’s possible we hit the bottom just weeks ago,” she suggested.
Over the past three months, Bitcoin’s value declined by about 20%, while gold surged nearly 60% year-to-date. However, Wood forecasts this pattern may reverse next year with gold pulling back and Bitcoin gaining momentum.
“Currently, gold serves as a risk-off asset reflecting investor anxiety,” she noted. “Its rise signals that markets are navigating significant geopolitical uncertainties.”
'Looking back from the early 1980s through the late ’90s when innovation flourished culminating in the Internet boom, gold prices fell sharply. We believe something similar could unfold now where Bitcoin reasserts itself as a risk-on asset,'' she added.
At present, Bitcoin trades near $94,000—up approximately 4% over the last day according to CoinGecko—as investors await tomorrow’s Federal Open Market Committee (FOMC) announcement anticipating this year’s final interest rate cut.