Cathie Wood Reaffirms $1.5M Bitcoin Target as BTC Surges Past Key $89,600 ETF Cost Basis
Introduction: A Week of Reversal and Reaffirmed Conviction
This week marked a significant turning point for cryptocurrency markets as Bitcoin staged a long-awaited recovery, breaking a four-week streak of negative momentum. In a move that brought relief to investors, Bitcoin’s (BTC) price reclaimed the pivotal $90,000 level. This surge pushed the price above the critical $89,600 flow-weighted cost basis for Bitcoin exchange-traded fund (ETF) buyers, returning many to a profitable position. Bolstering this positive shift, Cathie Wood, the CEO and chief investment officer of ARK Invest, publicly reaffirmed the firm's ambitious $1.5 million Bitcoin bull market price target. Her confidence stems from a projected influx of billions in liquidity following the conclusion of the US government shutdown, setting a bullish backdrop for a potential year-end rally.
Market Momentum Shifts as Rate Cut Expectations Surge
The crypto market's recovery was closely tied to a dramatic shift in US monetary policy expectations. Data from the CME Group’s FedWatch tool showed a sharp 46% weekly increase in the probability of interest rate cuts. Markets are now pricing in an 85% chance of a 25 basis point interest rate cut at the US Federal Reserve’s December 10 meeting, a significant jump from just 39% a week prior. This changing macroeconomic landscape, characterized by potentially lower borrowing costs, has provided a tailwind for risk-on assets like Bitcoin. However, despite this weekly rebound, broader context is crucial. According to data from blockchain provider CoinGlass, Bitcoin is still on track for its worst November in seven years, down approximately 17% on the monthly chart. This contrasts sharply with the month's historic average return of 41%, underscoring the severity of the recent correction preceding this week's bounce.
ARK Invest's Bull Case: Unchanged Amid Evolving Dynamics
In a webinar on Monday and subsequent social media posts, Cathie Wood provided detailed reasoning behind ARK Invest's steadfast $1.5 million Bitcoin price target for 2030. This figure, part of the firm's "bull case" scenario published in April—which also included a $300,000 "bear case" target—remains intact despite market volatility. Wood acknowledged that the landscape has evolved, noting that stablecoins have "accelerated, taking some of the role away from Bitcoin that we expected." However, she counterbalanced this by highlighting that "gold price appreciation has been far greater than we expected." Wood concluded that these opposing factors effectively netted out, leaving their flagship bull market prediction unchanged.
The Liquidity Inflection Point: QT Ends, Billions Return
A central pillar of ARK Invest's optimistic outlook is a fundamental shift in market liquidity. The firm detailed that the end of the record US government shutdown has already catalyzed the return of $70 billion into financial markets. Furthermore, ARK Invest projects an additional $300 billion is expected to return over the next five to six weeks as the Treasury General Account normalizes. Another critical catalyst is scheduled for December 1, when the US Federal Reserve is set to end its quantitative tightening (QT) program. This pivot away from reducing its balance sheet is seen as a precursor to a more supportive monetary environment. In a post on X, ARK Invest stated, “With liquidity returning, quantitative tightening (QT) ending December 1st, and monetary policy turning supportive, we believe conditions are building for markets to potentially reverse recent drawdowns.” Cathie Wood separately described the current "liquidity squeeze" limiting crypto and AI markets as set to "reverse in the next few weeks."
Regulatory Tailwinds: UK Proposes DeFi Tax Overhaul
In parallel to market movements, the regulatory environment showed signs of maturation. The UK's HM Revenue and Customs (HMRC) proposed a new "no gain, no loss" tax framework for decentralized finance (DeFi) activities. The proposal would defer capital gains taxes on crypto lending and liquidity pool contributions until the underlying token is genuinely sold, rather than at the point of depositing into a protocol. Under the new framework, taxable events would occur when liquidity tokens are redeemed, with gains or losses calculated based on the number of tokens received back compared to those initially contributed. This addresses a significant pain point, as current UK law can subject these actions to capital gains tax rates between 18% and 32%. Sian Morton, marketing lead at the cross-chain payments system Relay protocol, called it a "meaningful step forward for UK DeFi users" that moves "tax treatment closer to the actual economic reality of these interactions." Maria Riivari, a lawyer at DeFi platform Aave, added that it "would bring clarity that DeFi transactions do not trigger tax until you truly sell your tokens."
Capital Inflows: DWF Labs Launches $75M Institutional DeFi Fund
Highlighting growing institutional interest in the underlying infrastructure, crypto market maker and Web3 investment firm DWF Labs announced a new $75 million fund dedicated to DeFi. The fund explicitly aims to support projects that can foster institutional adoption. According to its announcement on X, the initiative will target blockchain projects building "dark-pool perpetual DEXs, decentralized money markets, and fixed-income or yield-bearing asset products." DWF Labs believes these areas are "poised for major growth as crypto liquidity continues its structural migration onchain." Andrei Grachev, Managing Partner at DWF Labs, emphasized that "DeFi is entering its institutional phase," noting "real demand for infrastructure that can handle size, protect order flow, and generate sustainable yield." The fund will focus on projects built on Ethereum, BNB Smart Chain, Solana, and Coinbase's layer-2 network, Base. Beyond capital, DWF Labs will offer portfolio projects support including liquidity provisioning, go-to-market strategy, and access to its network of exchanges and institutions.
Security and Recovery: Balancer Community Proposes Hack Fund Distribution
The week also featured developments in ecosystem security and response. Following a $116 million exploit of the Balancer protocol in November, two community members submitted a proposal outlining a plan to distribute a portion of the recovered funds. Of the total stolen amount, approximately $28 million was recovered by white hat hackers, internal rescuers, and StakeWise, an Ether (ETH) liquid staking platform. The current proposal covers the $8 million recovered by white hat and internal teams. It recommends that reimbursements be non-socialized—meaning funds are returned only to the specific liquidity pools that lost them—and paid on a pro-rata basis according to each holder's share represented by Balancer Pool Tokens (BPT). Furthermore, repayments would be made "in-kind," meaning victims receive payment in the specific tokens they lost to avoid price discrepancies. The remaining nearly $20 million recovered by StakeWise will be distributed separately to its users.
Corporate Forays: Enlivex Plans $212M RAIN Token Investment
In a notable example of corporate treasury movement into crypto, Nasdaq-listed biotech firm Enlivex Therapeutics (ENLV) revealed plans for a major pivot. The company intends to raise $212 million through a private investment in public equity (PIPE) offering, selling 212 million shares at $1 each—an 11.5% discount to its previous closing price. According to its filing and an announcement, Enlivex plans to invest the majority of this capital into Rain (RAIN), the utility token of the Rain decentralized prediction market on the Arbitrum network. Shai Novik, Executive Chairman at Enlivex Therapeutics, stated they see "prediction markets as one of the most exciting emerging sectors in the blockchain space" with "exceptional" long-term potential. He cited Rain's "decentralized" architecture as a key reason for the choice, describing it as a "scalable model which supports global access and growth." The company expects to complete its Rain purchases within 30 days of the offering's close.
DeFi Market Overview: A Green Week for Major Cryptos
According to data from Cointelegraph Markets Pro and TradingView, the majority of the top 100 cryptocurrencies by market capitalization posted gains this week. The memecoin SPX6900 (SPX) led the pack as the week's biggest winner with a surge of over 43%, followed closely by Kaspa’s (KAS) token, which rose 39% over the past seven days.
Strategic Conclusion: Navigating an Evolving Landscape
This week’s developments paint a picture of a digital asset market at an inflection point. The combination of technical price recovery above key ETF cost bases, reaffirmed long-term conviction from major institutional voices like Cathie Wood, and shifting macro liquidity conditions creates a foundation for potential sustained momentum. Simultaneously, progress in regulatory clarity—as seen with the UK's DeFi tax proposal—and significant capital allocation toward institutional-grade DeFi infrastructure signal maturation beyond mere price speculation.
For readers and investors navigating this space, several key themes warrant close observation in the coming weeks: monitoring Fed policy action on December 1 regarding quantitative tightening; tracking whether Bitcoin can maintain support above its ETF cost basis; observing if corporate treasury movements like Enlivex’s represent an emerging trend; and following community-led initiatives like Balancer’s for their effectiveness in handling post-exploit recovery.The interplay between macroeconomic policy easing and continued ecosystem development suggests that while short-term volatility may persist—as evidenced by November's overall negative performance—the structural pillars for long-term growth are being reinforced across multiple fronts