Analyst: Every $1 billion strategic Bitcoin reserve purchase drives a $20 billion market cap increase

ChainCatcher news, according to The Block, Katalin Tischhauser, head of investment research at Swiss crypto bank Sygnum, has released a new research report predicting that for every $1 billion invested in the U.S. strategic Bitcoin reserve, the market capitalization of Bitcoin will increase by approximately $20 billion through a multiplier effect. This 20-fold multiplier effect prediction is based on observational data during the funding inflow period in 2024.

The report points out that due to the limited supply of Bitcoin liquidity, new demand will trigger significant upward price shocks, with $19 billion of the increase coming from demand shocks and limited supply squeeze effects.

Tischhauser stated that the first and second rounds of $1 billion inflows will mainly absorb existing demand, while the third and fourth rounds of inflows will face a more constrained supply environment, thereby accelerating price increases. Additionally, net demand from various sources, including state governments seeking reserve assets, large institutional investor allocations, and corporate treasury activities, could drive this market effect.

It is worth noting that Trump established the Digital Asset Market Presidential Working Group in his first week in office, one of its tasks being to assess the feasibility of the U.S. strategic Bitcoin reserve.