HashKey's Xu Han: 'This Is Why Bitcoin Could Hit $1 Million by 2035'

While previous bullish cycles in 2017 and 2021 were driven by ICOs and bridging the gap was not satisfying for NFTs, the current cycle is dominated by a new story: the emergence of bridging the gap from organizations. And according to Xu Han, a partner at HashKey Capital, experienced investors tend to do things differently with their retail partners - giving them a significant advantage as they try to capitalize on market fluctuations. In an exclusive interview with Cryptonews, he said: “Allocators are no longer just participating in the long-term market, but are implementing complex strategies such as trading ETFs, price arbitrage staking, and full BTC deployment on DeFi.” Bitcoin was once considered a passive asset, but that is beginning to change as BTCFi platforms provide profit-generating strategies, allowing cryptocurrency holdings to increase over time. “We also see a clear priority for transparency in regulations: organizations prefer assets and products suitable for compliant custody services, ETF packages or licensed platforms.” Xu also argued that “the increasing dependence on on-chain data” makes seasoned investors different from the rest - and the data they care about is not limited to sentiment, but also tracks intelligence around “capital flows, protocol revenue, and wallet group behavior.” In conclusion, the sophistication of investors’ behavior is keeping pace with the complexity of the asset itself. ‘The Bull Race Is Not Over Yet’ In an interview with Cryptonews, Xu argued that there is “convincing evidence that the cryptocurrency cycle is still in a growth phase”, with the dollar expected to depreciate against major fiat currencies by up to 10% in the next 12 to 24 months. Another important factor is the anticipated policy changes by the Federal Reserve - reducing interest rates and gradually tapering quantitative easing are expected to bring new liquidity into the market. Historically, cryptocurrencies have reacted positively to such changes. Data on the chain also indicates that selling pressure from long-term holders has decreased, while short-term traders are repositioning. “These changes in behavior, combined with the strong ETF capital flow, indicate that we have not yet reached the typical peak of speculation for the post-gainer market phase. If anything, the fundamental factors are currently stronger than in previous cycles, as evidenced by the increasing number of days companies are investing in Bitcoin inspired by the success of MicroStrategy.” Xu continues to reveal that HashKey Capital believes there is "a reasonable trajectory that Bitcoin could reach $1 million " by 2035. “It is clear that the acceptance of organizations of Bitcoin’s role as a digital store of value will continue to accelerate, especially as portfolio integration accelerates across the entire traditional finance sector. Our central thesis predicts that Bitcoin’s market capitalization could eventually equal that of investable gold — including physical bars, coins, and ETF holdings — over the next decade.” Returning to the current gainer market, Xu acknowledges that this is the second ‘weak quarter’ for altcoins — but some selected names may be gearing up for a ‘strong performance’ in Q3. The fundamental elements of Ethereum remain strong: it still stores a large portion of encrypted assets and operates smart contracts. Although its ETH/BTC ratio has decreased, we understand that this is a result of ETF capital concentration on Bitcoin rather than loss of utility. Cryptocurrency analysts note that Solana has also proven an “impressive appeal” - especially when considering its mainstream integration with Strike and PayPal - and continues to capture DeFi activity. “Meanwhile, liquidity staking and restaking protocols such as Lido and EigenLayer provide a unique layer of profit that institutional allocators are increasingly recognizing. These assets tend to act as high-beta amplifiers in the late stages of cryptocurrency bull runs, and their profit dynamics provide additional returns in risk environments.” These optimistic predictions come in the context of increasing economic instability - first due to Donald Trump’s tariff levels on Liberation Day, and then becoming more serious due to escalating tensions in the Middle East. YouHolder’s risk manager, Andrejs Balans, told Cryptonews that recent developments have led to over $1 billion in liquidated leveraged positions - and optimistic traders are the hardest hit as they were not prepared. “This weekend’s events prove that, although cryptocurrencies are decentralized, they are still deeply influenced by both political and investor sentiment. For those in the market, adapting to a world full of sudden shocks may be as important as discovering the next big opportunity. In the near future, we can expect continuous volatility.”