Why Bitwise thinks Bitcoin could reach $1.6M by 2036?

Bitcoin (BTC) could reach $1.6 million by 2036 as institutional investment, limited supply and growing concerns over currency devaluation drive demand for the cryptocurrency, according to asset manager Bitwise.

Bitcoin to hit $1.6 million over the next decade

In its Bitcoin Long-Term Capital Market Assumptions report Wednesday, the company projected that Bitcoin would deliver an annualized return of 34.3% over the next decade. The forecast marks an increase from the firm's previous projection of $1.3 million by 2035, which implied an annualized return of 28.3%.

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

The report identified institutional adoption as a major driver of its bullish outlook, arguing that large investors have significant room to increase their Bitcoin holdings. Bitwise said institutional investors control roughly $147 trillion in assets, and most still have no Bitcoin allocation.

The firm expects these investors to allocate between 1% and 5% of their portfolios to Bitcoin over the next decade, potentially creating $1.5 trillion to $7.4 trillion in demand.

Bitwise also noted that US spot Bitcoin exchange-traded products (ETPs) already hold $108 billion in assets, less than three years after their launch. The firm expects institutional inflows to accelerate from 2027 as Bitcoin products become more accessible through wealth management platforms.

Bitcoin's limited supply strengthens its outlook

Bitcoin's fixed supply is another key part of Bitwise's valuation thesis. The top crypto has a maximum supply of 21 million BTC, with approximately 20.1 million already in circulation.

The report put Bitcoin's annual supply inflation rate at 0.8%, which is expected to fall to 0.4% in 2028 and 0.2% in 2032 under its predetermined issuance schedule. By comparison, gold's annual inflation rate is approximately 2%.

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

The firm argued that rising demand against a supply that cannot expand in response could push Bitcoin's price higher.

Rising government debt could increase demand for Bitcoin

Bitwise also pointed to growing government debt and concerns about fiat currency devaluation as factors that could support Bitcoin's long-term value.

The report said US federal debt reached $40.2 trillion in September 2026, while annual interest payments stood at $1.1 trillion. Bitwise expects governments to face increasing pressure from rising debt burdens, potentially encouraging investors to seek alternatives to traditional currencies.

The firm sees Bitcoin benefiting both from gaining a larger share of the store-of-value market and from the market itself expanding.

However, Bitwise cautioned that its valuation model does not guarantee future results. It also identified technological threats, including quantum computing and AI-driven advances in mathematics, alongside regulatory and government risks, as potential challenges to its long-term forecast.