Compared to other asset classes, bitcoin is young, but the largest digital asset by market capitalization is no stranger to impressive price forecasts.
Boffo Bitcoin forecast could boost this ETF
In the form of a repeat, another recently arrived for bitcoin when venture capitalist and noted bitcoin bull Tim Draper reiterated his view that the cryptocurrency could rise to $250,000 next year. That implies an upside of more than 12 times from where bitcoin was as of November 7.
Should that forecast come even close to proving accurate, a selection of exchange-traded funds would likely come in handy. That group includes Invesco Alerian Galaxy Crypto Economy ETF (SATO ). SATO follows the Alerian Galaxy Global Cryptocurrency-Focused Blockchain Equity, Trusts and ETPs Index.
SATO may be worth evaluating in the near term, with Draper predicting a move to $250,000 by “mid-2023” of bitcoin.
“The new time horizon from the well-known venture investor came after he first predicted in 2018 that Bitcoin would hit that mark in 2022. This had come after Draper correctly predicted that Bitcoin would surpass $10,000 by 2017 back in 2014,” reports Fredrik Vold for CryptoNews.
For investors looking to participate in some of the potential upside while not owning bitcoin directly, SATO is a relevant solution. Invesco ETF allocates 16.37% of its weight to Grayscale Bitcoin Trust BTC (GBTC)which ensures ETF has more than sufficient influence on bitcoin price action.
The rest of SATO’s 39 holdings are stocks labeled “crypto-correlated”. It enhances SATO’s ability to deliver bitcoin participation to investors without forcing them to own the digital asset directly. It could be an attractive feature going forward.
“Tim Draper has been a well-known investor in early-stage technology companies for several years now. Among his best-known investments are companies such as Tesla, SpaceX, Robinhood and Skype,” according to CryptoNews. “Draper has said he first bought Bitcoin in 2011 at the now-defunct Bitcoin exchange Mt. Gox. He lost everything when Mt. Gox collapsed. He still didn’t lose faith in the cryptocurrency, and in 2014 he won a US Marshals Service auction for nearly 30,000 BTC at a price of $472 per coin.”
Strengthen the case for SATO is that the ETF’s list includes some high-quality stocks that could be due for a comeback next year, regardless of how bitcoin performs. These include Goldman Sachs (SNEEZE: GS), JPMorgan Chase (SNEEZE: JPM), Microsoft (NASDAQ: MSFT), and Nvidia (NASDAQ: NVDA).
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