Wellington-Altus Chief Market Strategist James E. Thorne argued that the main issue facing Bitcoin is not volatility, but its “absolute scarcity” characteristic, which investors have not yet fully priced in.
Thorne noted that in traditional financial circles, the view is frequently expressed that Bitcoin is too volatile to be included in the same portfolio as gold and large-cap corporate stocks. However, the strategist pointed out that drops of 30% to 40% in AI chip manufacturers and high-beta technology stocks are tolerated, and that even assets with a market capitalization exceeding $5 trillion can be considered basic investment vehicles.
Therefore, Thorne stated that volatility alone is not sufficient to exclude an asset from a portfolio, and that the real difference stems from asset class, regulatory structure, and political acceptance. He reminded that semiconductor companies are cash-generating stocks and can be easily included in technology-focused portfolios, while Bitcoin is a monetary asset that does not generate returns, is not tied to any state, and has a limited supply of 21 million units. According to Thorne, the “too volatile” label used for Bitcoin serves as a justification that masks the lack of sufficient regulatory and institutional authority for large investment firms.
He said that if the Clarity Act, currently under consideration in the US, explicitly recognizes and regulates digital assets, investment committees could consider Bitcoin a legitimate portfolio component rather than a compliance issue.
Thorne stated that Bitcoin’s valuation potential would be clearer if regulatory obstacles were removed, arguing that Bitcoin doesn’t need to reach gold’s market capitalization. He suggested that even if Bitcoin only approached Nvidia’s current market capitalization, its unit price could reach approximately $240,000 to $250,000.
Thorne predicted that if Bitcoin were to reach the same market capitalization as gold, its price could rise to between $1.5 million and $1.8 million. He stated that these scenarios are based on Bitcoin’s limited supply, a decrease in the effective supply in circulation, and the normalization of institutional access.
Noting that markets have accepted the sharp fluctuations in AI companies reaching multi-trillion-dollar valuations, Thorne argued that the view that volatility should keep Bitcoin’s value well below these levels stems from monetary and political preferences rather than a genuine risk analysis.
