Bitcoin has had a strong start to the decade, adding over 40% to its price so far this year—and taking its market capitalization to around $200 billion.
The bitcoin price, which began the year at around $7,000 per bitcoin token, has been on a roller coaster through 2020, crashing to under $4,000 in March before rebounding to well over $10,000.
With a raft of established investors turning to bitcoin this year as a potential hedge against the inflation they see coming as a result of unprecedented government spending and money-printing, a prominent investor in electric car-maker Tesla TSLA has said it expects bitcoin's total value to balloon to between $1 trillion and $5 trillion during the next five to ten years.MORE FROM FORBESBitcoin And Blockchain Are The 'Future' Of Twitter, CEO Jack Dorsey RevealsBy Billy Bambrough This year has seen a number of high-profile investors name bitcoin as a potential hedge against ... [+] inflation. NurPhoto via Getty Images
"Bitcoin offers one of the most compelling risk-reward profiles among assets, as our analysis suggests it should scale from roughly $200 billion today to $1-5 trillion network capitalization during the next five to ten years," Ark Investment Management analyst, Yassine Elmandjra, wrote in a report out last month, adding that investors shouldn't ignore bitcoin as an asset class.
Ark is best known for its wildly optimistic price target for Tesla—a bet that has somewhat paid off this year as the Tesla price increased fourfold.
Bitcoin was by far the best performing asset of the last decade, with its price increasing from almost zero to highs of around $20,000 per bitcoin token in late 2017 before falling back somewhat. But, despite this massive run, Ark remains very bullish on bitcoin.
"Our analysis suggests bitcoin is early on its path to monetization, with substantial appreciation potential," Elmandjra wrote. "In...