David Puell from Ark Invest believes that Bitcoin’s upcoming market phase will hinge less on whether investors trust the asset and more on the extent of their exposure and the methods they use to invest.
Puell, who serves as a research trading analyst and associate portfolio manager for digital assets at Ark Invest—an asset management firm led by Cathie Wood—explained that Bitcoin has reached a significant milestone in institutional maturity. This progress follows the introduction of spot Bitcoin exchange-traded funds (ETFs) in 2024 alongside rapid expansion in digital asset treasury (DAT) strategies.
“In previous cycles, much of the infrastructure was still under development,” Puell remarked. “Now, it’s not about deciding whether to invest in Bitcoin but determining how much to allocate and through which investment vehicle,” he told CoinDesk during an interview.
Since gaining regulatory approval earlier this year, U.S.-based spot Bitcoin ETFs have swiftly become major channels funneling capital into cryptocurrency markets. These products have collectively drawn over $50 billion in net inflows within approximately 18 months—a clear indicator of a broad shift toward institutionalized and regulated access to Bitcoin without requiring direct self-custody.
Leading this influx are BlackRock’s iShares Bitcoin Trust (IBIT) and Fidelity’s Wise Origin Bitcoin Fund (FBTC), which have significantly enhanced liquidity while tightening supply constraints. Estimates suggest these ETFs control hundreds of thousands of Bitcoins combined.
This transformation has had a measurable effect on supply-demand dynamics. According to Puell, ETFs together with digital asset treasury entities now hold about 12% of total Bitcoin supply—far surpassing initial expectations—and represent one of the primary forces influencing price movements through 2025 with potential continuation into 2026.
Digital asset treasury companies are publicly traded firms whose main strategy involves holding cryptocurrencies like Bitcoin as core balance-sheet reserves aimed at increasing shareholder value.
However, Puell also highlighted an opposing trend: long-term holders who acquired Bitcoins over ten years ago are increasingly willing to realize profits when prices hit new peaks.
“During bull markets, early adopters tend to take profits more aggressively near market tops,” he explained. “Conversely, they usually hold during bear phases. In 2025 we witnessed these two forces clashing—the profit-taking by early adopters versus institutional accumulation via ETFs and DATs.”
Despite these competing influences, Ark remains optimistic about its long-term valuation framework for Bitcoin. Their model forecasts price targets for 2030 ranging from around $300,000 under bearish conditions up to approximately $1.5 million per coin if bullish scenarios materialize—with a base case near $710,000 according to published estimates.
Puell noted that bitcoin’s role as “digital gold”, serving primarily as a store-of-value instrument contributes most heavily toward both bear and base case valuations whereas increased institutional investment accounts largely drive upside potential within bullish projections.
A key supporting factor is what Puell describes as bitcoin’s growing “vaulted” supply status: On-chain data indicates network activity levels hovering around sixty percent since early 2018—a metric Ark interprets meaning roughly thirty-six percent of all bitcoins remain effectively locked away by long-term holders unwilling or unable to liquidate them readily.
The macroeconomic environment could further bolster bitcoin throughout coming years: The conclusion of monetary tightening policies by U.S authorities may introduce fresh liquidity flows favoring risk assets such as bitcoin historically associated with periods following easing cycles.
“For bitcoin specifically,” said Puell, “taking into account U.S liquidity metrics matters far more than global M2 money supplies,” ”
he added noting America often sets trends others follow due its position atop global capital markets.
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Additional structural shifts include changes in volatility patterns:
Puell pointed out that volatility has dropped substantially compared with prior cycles reinforcing Ark’s thesis regarding improved risk-adjusted returns.
‘’The usual drawdowns between thirty-five percent up-to fifty percent experienced during bull runs seem less frequent now,”’
he said noting since bottoming out last cycle there hasn’t been any pullback exceeding thirty-six percent which is atypical.
This decline coupled with shallower corrections may broaden appeal among conservative investors previously deterred due high perceived risks.
“More sophisticated players avoid compounding aggressively amid parabolic spikes instead reserving cash buffers deployed selectively during dips,”’
Puell explained adding this behavior tends flatten volatility curves while shortening recovery times.
He also cited factors like clearer regulatory frameworks established post-Trump administration emergence staking-related ETF products plus heightened interest from states such Texas acting collectively provide positive longer term tailwinds.
While creation strategic US government-held reserves wouldn’t generate additional demand directly it would strengthen holder bases unlikely sell positions anytime soon.
Ark recently revised part outlook acknowledging some anticipated safe-haven demand originating from emerging economies shifted towards stablecoins however offsetting gains stemmed mainly from unexpectedly strong gold-linked applications embedded inside their models.
“We remain committed firmly towards our forecast targets,” stated Puell emphasizing “demand composition evolves but fundamental thesis stands robust.”
Looking beyond immediate horizons extending past year five frame remains priority rather than chasing short term pricing swings arguing maturation process transitioning bitcoin towards lower-volatility institutionally dominated ecosystem ultimately holds equal importance relative any single numeric valuation level.
Further reading:Asset manager Bitwise sees three tests ahead for crypto rally in 2026 .