Bitwise research head puts Bitcoin's fair value at $197,000

Bitwise research head André Dragosch said a global money-supply model puts Bitcoin's equilibrium value near $197,000, more than twice its current price. Dragosch made the argument in an interview on Sept. 29. He said fiscal policy has become more supportive, but monetary policy remains the missing piece for a sustainable Bitcoin bull market. Dragosch argued that elevated interest rates are tightening financial conditions. Bitwise research found that an increase of around 80 basis points in the 10-year Treasury yield over 20 trading days materially raises the probability of a sharp S&P 500 correction. Dragosch said the latest 20-day increase was around 50 basis points. Higher yields were already affecting mortgage rates and the housing market, he said. A larger stock correction could raise recession and financial-stability risks, potentially prompting the Fed to pause or shift policy. The model puts Bitcoin below its implied liquidity value, unlike the S&P 500 and gold. A weaker dollar and a shift from AI stocks into cryptocurrencies could help close that gap. Bitwise research shows Bitcoin has historically performed best during periods of pronounced dollar weakness and expanding global liquidity. Dragosch said Bitcoin's correlation with the S&P 500 had fallen to its lowest since 2015. He said its correlation with gold had reached a six-year high. Dragosch sees a potential 10% to 20% S&P 500 correction but expects Bitcoin's downside to be more limited after its earlier decline.