The Structure Behind Bitcoin Surpassing 10 Million
With "the last big buyers" – hedge funds and pension funds – beginning their full-scale entry into the cryptocurrency market, Bitcoin is irreversibly transitioning from a speculative commodity to an institutional asset class. This structural shift will fundamentally alter not only its price but also the risk allocation across the entire financial system.
── Understand in 3 points ─────────
- • The market is discussing the possibility of Bitcoin reaching a price range of 10 million to 12 million yen (approximately $65,000 to $78,000) by early 2026.
- • Major U.S. hedge funds (such as Bridgewater, Citadel) are accelerating their moves to incorporate 1-3% of Bitcoin into their portfolios.
- • Japan's Government Pension Investment Fund (GPIF) is reportedly advancing research into alternative investments, including cryptocurrencies.
── NOW PATTERN ─────────
The institutional path dependency of Bitcoin ETF approval is making institutional investor entry irreversible, and a self-reinforcing cycle of capital inflow is forming a winner-takes-all structure. This movement is spreading as a chain of contagion to regulators, pension funds, and corporations in various countries.
── Probabilities and Responses ──────
• Base case 50% — Stable monthly capital inflow of $3-5 billion into ETFs, FRB interest rate cuts at a quarterly pace, concrete discussions on Japan's tax reform but no legislation.
• Bull case 25% — FRB implements significant interest rate cuts of 50bp or more, major pension funds announce BTC allocation, Japan's cryptocurrency separate taxation is legislated, reports of BRICS sovereign BTC demand.
• Bear case 25% — New regulatory measures by the SEC, bankruptcy of major crypto asset companies, FRB shifts to interest rate hikes, significant security incidents, risk-off due to geopolitical shocks.
📡 THE SIGNAL — What Happened
Why it matters: With "the last big buyers" – hedge funds and pension funds – beginning their full-scale entry into the cryptocurrency market, Bitcoin is irreversibly transitioning from a speculative commodity to an institutional asset class. This structural shift will fundamentally alter not only its price but also the risk allocation across the entire financial system.
- Price Trends — The market is discussing the possibility of Bitcoin reaching a price range of 10 million to 12 million yen (approximately $65,000 to $78,000) by early 2026.
- Institutional Investors — Major U.S. hedge funds (such as Bridgewater, Citadel) are accelerating their moves to incorporate 1-3% of Bitcoin into their portfolios.
- Pension Funds — Japan's Government Pension Investment Fund (GPIF) is reportedly advancing research into alternative investments, including cryptocurrencies.
- ETF — Cumulative capital inflows into spot Bitcoin ETFs, approved in the U.S. in January 2024, exceeded approximately $50 billion by the end of 2025, making access for institutional investors dramatically easier.
- Halving — The Bitcoin halving in April 2024 reduced the new supply from approximately 900 BTC per day to about 450 BTC, intensifying supply constraints.
- Regulation — Japan's Financial Services Agency (FSA) has indicated a policy to reorganize crypto assets within the framework of the Financial Instruments and Exchange Act in 2025, and discussions are underway regarding a shift to separate taxation.
- Macro Environment — The FRB entered an interest rate cutting cycle from late 2025, with the federal funds rate falling to 4.0-4.25% by March 2026, boosting capital inflows into risk assets.
- Geopolitics — Emerging economies (BRICS nations) seeking to move away from the dollar are reportedly considering Bitcoin as a complementary means of foreign exchange reserves.
- Technology — The spread of the Lightning Network and the development of Layer 2 solutions are improving Bitcoin's payment utility.
- Corporate Holdings — MicroStrategy's Bitcoin holdings reached approximately 250,000 BTC by the end of 2025, continuing the trend of corporate BTC holdings.
- Japanese Market — Monthly trading volume on crypto asset exchanges in Japan increased by approximately 60% year-on-year in 2025, with expanding participation from individual investors.
- Mining — Bitcoin's hash rate continues to set new records, strengthening the network's security and decentralization.
To understand the phenomenon of Bitcoin approaching the psychological milestone of 10 million yen, it is necessary to look back at the 15-year structural evolution of the crypto asset market.
When Satoshi Nakamoto introduced Bitcoin to the world in 2009, it was merely an experiment by cryptographers and libertarians. For the first decade, Bitcoin fluctuated wildly between the narrative of "digital gold" and the criticism of being a "speculative bubble." In 2013, Bitcoin first gained attention as a "safe-haven asset" during the Cyprus financial crisis, and in 2017, it became ingrained in public consciousness with the ICO bubble, but these were all within the realm of speculative fervor.
The turning point came in 2020. The massive monetary easing by central banks worldwide in response to the COVID-19 pandemic strengthened the narrative of Bitcoin as a hedge against fiat currency debasement. Paul Tudor Jones publicly declared "Bitcoin as an inflation hedge," and Michael Saylor of MicroStrategy began holding BTC as a corporate asset, paving the initial path for institutional investor entry.
However, the FTX collapse and Terra-Luna implosion in 2022 dealt a devastating blow to the crypto asset industry. This "crypto winter" purified the industry while clearly highlighting the need for stronger regulation. Ironically, this very regulatory strengthening became the catalyst for accelerating institutional investor entry. Following the FTX collapse, the U.S. SEC (Securities and Exchange Commission) intensified its oversight of crypto asset exchanges and raised compliance standards. This regulatory clarification lowered the barrier to entry for institutional investors who prioritize risk management.
The approval of spot Bitcoin ETFs in January 2024 was a decisive turning point in this trend. With the world's largest asset management companies like BlackRock, Fidelity, and Vanguard beginning to offer Bitcoin ETFs, traditional institutional investors such as pension funds, insurance companies, and university endowments gained access to Bitcoin without compliance barriers. This is structurally the same pattern as the impact on the gold market when gold ETFs were approved in 2004.
The situation in Japan is also noteworthy. Japan, once the epicenter of the Mt. Gox incident (2014), had a strong sense of caution towards crypto assets, but gradual regulatory improvements by the Financial Services Agency have progressed, and discussions on crypto asset tax reform gained full momentum in 2025. The transition from the current miscellaneous income tax (up to 55%) to separate self-assessment taxation (20%) would significantly lower the effective barrier to crypto asset investment for both individual and institutional investors in Japan.
The macroeconomic context is also crucial. The FRB's rapid interest rate hike cycle from 2022 to 2023 pressured risk assets across the board, but the shift to interest rate cuts from late 2025 created an environment for excess liquidity to return to risk assets. Historically, the 12-18 months after the start of an FRB rate-cutting cycle have been the best period for risk asset performance, and Bitcoin is benefiting from this pattern.
Furthermore, the Bitcoin halving in April 2024 is intensifying supply-side constraints. After the previous three halvings (2012, 2016, 2020), Bitcoin has repeatedly set new all-time highs within 12-18 months. If this pattern continues after the 2024 halving, late 2025 to early 2026 would be the period for peak price formation.
From a geopolitical perspective, challenges to the dollar's unipolar dominance are strengthening Bitcoin's position as a "neutral reserve asset." The movement by BRICS nations to de-dollarize and the precedent of SWIFT exclusion due to sanctions on Russia are creating motives for considering Bitcoin as part of national foreign exchange reserves. El Salvador's adoption of Bitcoin as legal tender in 2021 was a pioneering case, but from 2025 onwards, countries with larger economic scales are beginning to show interest in this experiment.
The simultaneous action of these multiple structural factors—regulatory clarification, easier access via ETFs, supply constraints from halving, monetary easing cycles, and geopolitical demand—is what makes the current phase qualitatively different from past bubbles. The question is whether these factors will support a sustained price increase or if they will lead to repeated overheating and collapse, similar to past cycles.
The delta: Bitcoin is at a turning point, transitioning from a "speculative asset" to an "institutional asset class." The approval of spot ETFs has removed access barriers for institutional investors, and increased demand from the halving's supply constraints and the interest rate cutting cycle are acting simultaneously. This structural change is not a temporary boom but an irreversible shift in Bitcoin's position within the financial system, and the price breaking 10 million yen is merely a superficial indicator of this.
🔍 BETWEEN THE LINES — What the News Isn't Saying
While official discussions frame it as "portfolio diversification" or "digital gold," what institutional investors truly fear is the "risk of not holding Bitcoin." Fund flow data after ETF approval suggests that pension funds and university endowments are beginning allocations, driven by client demand. The FSA's haste to re-regulate crypto assets stems from an unstated sense of crisis regarding the outflow of capital and talent to Singapore and Hong Kong. In other words, while ostensibly "investor protection," the reality is "deregulation as industrial policy," and this gap between rhetoric and reality is key to understanding future policy directions.
NOW PATTERN
Path Dependency × Winner-Takes-All × Chain of Contagion
The institutional path dependency of Bitcoin ETF approval is making institutional investor entry irreversible, and a self-reinforcing cycle of capital inflow is forming a winner-takes-all structure. This movement is spreading as a chain of contagion to regulators, pension funds, and corporations in various countries.
Intersection of Dynamics
Path dependency, winner-takes-all, and chain of contagion—these three dynamics are not acting independently but are forming mutually reinforcing feedback loops. It is at this intersection that the structural foundation for Bitcoin's breakthrough to 10 million yen lies.
Path dependency accelerates winner-takes-all. Once institutional infrastructure like ETFs is established, institutional capital concentrates on Bitcoin, which has the highest liquidity and is the most institutionally prepared. As it will take years for other crypto assets to gain the same institutional legitimacy as Bitcoin, Bitcoin's first-mover advantage will further expand during this period.
Winner-takes-all promotes the chain of contagion. Once Bitcoin establishes itself as the "default crypto asset" in institutional portfolios, not investing in Bitcoin itself becomes perceived as a risk. This becomes a powerful selling point for pension fund consultants and asset management companies, accelerating the speed of contagion.
The chain of contagion deepens path dependency. As more institutional investors enter, Bitcoin's market liquidity tends to improve, and volatility tends to decrease. Lower volatility facilitates further institutional entry, creating new path dependency. This positive feedback loop acts to irreversibly establish Bitcoin as an "institutional asset class."
However, the intersection of these three dynamics can operate similarly not only in upward phases but also in downward phases. If major regulatory changes or macroeconomic shocks occur while institutional capital is concentrated in Bitcoin, the chain of contagion could act in reverse, and path dependency could, conversely, create a situation where a "selling" chain cannot be stopped. Recognizing this bidirectional nature is essential for correctly evaluating current optimism.
📚 PATTERN HISTORY
2004: Approval of Gold ETF (GLD) and Rise in Gold Prices
The introduction of institutional access means, such as ETFs, accelerated institutional capital inflows and formed a long-term upward trend in asset prices.
Structural Similarity to Today: After the approval of the gold ETF in 2004, gold prices more than tripled over approximately seven years (from about $400 to about $1900). ETFs functioned as a "conduit" for new demand, changing the market structure itself by attracting investor segments that previously lacked access. Spot Bitcoin ETFs are highly likely to follow a similar pattern.
2000s: Spread of Alternative Investments to Institutional Investors
As hedge funds and private equity were incorporated into pension fund portfolios, once initial skeptical institutions entered, others followed in a cascade.
Structural Similarity to Today: The endowment model (advocated by David Swensen of the Yale University Endowment) became widespread, and allocations to alternative investments spread across pension funds within a few years. Initial allocations of 2-5% reached 20-30% after 10 years. The inclusion of Bitcoin in institutional investor portfolios may show a similar acceleration pattern.
2017: Approval of Bitcoin Futures and the 2018 Crash
The first step towards institutionalization created excessive short-term expectations, leading to a price bubble and its collapse, but contributed to market maturity in the long run.
Structural Similarity to Today: When CBOE and CME listed Bitcoin futures in December 2017, the BTC price surged to approximately $20,000 before crashing to about $3,200 in 2018. However, the existence of a futures market provided risk management tools for institutional investors and contributed to long-term market maturity. The current ETF approval also carries short-term overheating risks but will contribute to market stabilization in the long run.
1971: Nixon Shock and the End of the Gold Standard
When confidence in the existing monetary system falters, demand for alternative stores of value surges.
Structural Similarity to Today: After the collapse of the gold standard, gold prices rose approximately 20-fold throughout the 1970s. Demand for hedging against the depreciation of fiat currency supported this rise. The current increase in demand for Bitcoin is structurally similar, acting as a hedge against central bank balance sheet expansion and the debasement of fiat currencies.
2020: Massive Monetary Easing and Bitcoin's Surge After the COVID-19 Shock
Large-scale liquidity provision by central banks boosted risk assets across the board, particularly accelerating capital inflows into alternative assets like Bitcoin.
Structural Similarity to Today: After the FRB resumed zero interest rates and quantitative easing in March 2020, Bitcoin rose from approximately $6,000 to about $69,000 by November 2021. Excess liquidity disproportionately flows into risk assets, especially those with limited supply. While the current interest rate cutting cycle is not as sharp as in 2020, the direction is the same, and Bitcoin is highly likely to benefit from this pattern again.
Patterns Revealed by History
What emerges from historical patterns is the rule that asset prices rise non-linearly when "the creation of institutional access mechanisms" and "changes in the macroeconomic environment" act simultaneously. The rise in gold prices after the 2004 gold ETF approval, the spread of alternative investments in the 2000s, and Bitcoin's surge after COVID in 2020 all embody this pattern. Common to these are the simultaneous fulfillment of three conditions: (1) institutional changes making new investor segments accessible, (2) declining confidence in the existing financial system, and (3) concentrated demand for assets with supply constraints. The current environment surrounding Bitcoin fulfills all three of these conditions in the form of the completion of institutional conduits like ETFs, supply constraints due to halving, and the shift to a central bank easing cycle. However, as the crash after the 2017 futures approval shows, there is also a risk of excessive expectations forming a bubble in the early stages of institutionalization. History rhymes, but it does not repeat the same poem.
🔮 WHAT'S NEXT
Bitcoin will temporarily break through 10 million yen (approximately $65,000) by March 2026 but will not sustainably maintain this level, instead trading in the 8 million to 11 million yen range. Institutional investor entry will continue, but at a slower pace than optimists expect. Capital inflows into spot Bitcoin ETFs will continue at a monthly pace of $3-5 billion, with annual cumulative inflows reaching $40-60 billion. However, pension fund entry will be limited to some advanced funds, and ultra-large funds like GPIF will not reach the stage of actually purchasing Bitcoin. FRB interest rate cuts will continue, but the risk of re-accelerating inflation may slow the pace of cuts. By March 2026, the federal funds rate will remain around 4.0%, not reaching the significant easing expected by the market. In this environment, Bitcoin will be robust as a risk asset but will not experience explosive growth. Japan's tax reform will remain at the discussion stage, and separate taxation for crypto assets will not be included in the 2026 tax reform outline. This will limit institutional investor entry from within Japan. However, the ongoing depreciation of the yen will act as a factor pushing up the yen-denominated price of dollar-denominated Bitcoin, making a breakthrough to 10 million yen in yen terms possible. On the regulatory front, the framework for crypto asset regulation by the SEC and CFTC will progress, but the possibility of new restrictive regulations being introduced remains. Overall, Bitcoin will steadily advance its transition to an institutional asset class, but the pace will be more "gradual" than "revolutionary."
Investment/Action Implications: Stable monthly capital inflow of $3-5 billion into ETFs, FRB interest rate cuts at a quarterly pace, concrete discussions on Japan's tax reform but no legislation.
Bitcoin will break through 12 million yen (approximately $78,000) by March 2026 and enter an upward trend targeting 15 million yen (approximately $100,000). There are multiple catalysts for this scenario. First, the FRB will undertake more aggressive interest rate cuts than expected, with the federal funds rate falling below 3.5% by March 2026. Signs of an economic slowdown will strengthen the FRB's dovish stance, recreating a 2020-like environment where excess liquidity flows into risk assets. Second, major pension funds (such as CalPERS and GPIF) will formally announce allocations to Bitcoin ETFs, granting final approval of "institutional legitimacy." This will accelerate the chain of contagion, leading institutional investors worldwide to begin allocating to Bitcoin simultaneously. Third, the Japanese government will announce the application of separate taxation (20%) for crypto assets from fiscal year 2026, leading to a surge in capital inflows from both individual and institutional investors in Japan. Fourth, some BRICS nations will formally declare their policy to include Bitcoin in their foreign exchange reserves, adding a new source of demand in the form of sovereign demand. If these factors align, Bitcoin's price will significantly surpass its all-time high, following the post-2024 halving cycle pattern. However, it is important to note that this scenario also entails increased overheating risk, potentially leading to a significant correction phase in late 2026.
Investment/Action Implications: FRB implements significant interest rate cuts of 50bp or more, major pension funds announce BTC allocation, Japan's cryptocurrency separate taxation is legislated, reports of BRICS sovereign BTC demand.
Bitcoin will remain around 7 million yen (approximately $45,000) by March 2026, failing to break through 10 million yen. The pace of institutional investor entry will slow significantly. The biggest risk factor in this scenario is unexpected regulatory tightening. If the SEC introduces new crypto asset regulations and tightens ETF operating conditions, or if legal actions against major crypto asset exchanges damage market confidence. A recurrence of a large-scale crypto asset company failure, such as the FTX collapse in 2022, would rapidly intensify institutional investors' risk-averse stance. The second risk is a deterioration of the macroeconomic environment. If the FRB halts interest rate cuts or shifts to rate hikes (e.g., due to re-accelerating inflation from geopolitical risks), risk assets across the board will face selling pressure. Bitcoin, in particular, has shown increased correlation with the stock market, so it could be sold off in conjunction with a significant stock market decline. The third risk is technical issues. If a serious security vulnerability is discovered in the Bitcoin network, or if the advancement of quantum computing is perceived as a threat to Bitcoin's cryptographic technology, market sentiment will rapidly deteriorate. As a fourth risk, the rise of competing digital assets or CBDCs could erode Bitcoin's relative advantage. Particularly if China's digital yuan gains international widespread adoption, Bitcoin's narrative as an "alternative currency" would weaken. In this scenario, Bitcoin will not die, but the breakthrough to 10 million yen in the first half of 2026 will not materialize, carrying over to the next cycle.
Investment/Action Implications: New regulatory measures by the SEC, bankruptcy of major crypto asset companies, FRB shifts to interest rate hikes, significant security incidents, risk-off due to geopolitical shocks.
Key Triggers to Watch
- FRB FOMC meeting decision on interest rate cut magnitude (25bp vs 50bp): March 18-19, 2026
- Inclusion or exclusion of separate taxation for crypto assets in Japan's 2026 tax reform outline: December 2025 (outline announcement) ~ March 2026 (parliamentary deliberation)
- Indication of changes in alternative investment policy in GPIF's annual report: July 2026 (2025 fiscal year investment report)
- U.S. SEC's formulation of new rules for crypto asset regulation: First half of 2026
- Reports of management instability at major crypto asset companies (including stablecoin issuers like Tether): Constant monitoring (especially during sharp BTC price drops)
🔄 TRACKING LOOP
Next Trigger: FRB FOMC March 18-19, 2026 — The decision on the magnitude of interest rate cuts will determine Bitcoin's short-term direction. A 50bp cut accelerates the Bull case, while a hold approaches the Bear case.
Continuation of this Pattern: Tracking Theme: Bitcoin's Institutionalization Process — Next milestones are Japan's 2025 December Tax Reform Outline, March 2026 FOMC, and GPIF's July 2026 Annual Report.
>How do you read it? Participate in the prediction →
