Widely followed investor Cathie Wood said Thursday increasing allocation to bitcoin from hedge funds and other large investors could add $500,000 to the cryptocurrency's value over time. "Institutions are moving in. To some extent, this is a new asset class with correlation very different compared to other asset classes," Wood said on CNBC's " Squawk Box " on Thursday. "Institutional managers have to look at new asset classes that are evolving and that have low correlation. That's the key to diversification, and it's the holy grail in terms of asset allocation." "The move actually by institutions into bitcoin, if we were to choose bitcoin and that seems to be their first stop, could add $500,000 to bitcoin's price if they move into roughly 5% over time," she added. The founder and CEO of Ark Investment Management has been a longtime crypto bull. Wood has been buying up proxies for the digital asset in names such as Coinbase and Grayscale Bitcoin Trust. She has been calling for bitcoin to surge tenfold in the next five years on the back of strong demand from institutions. Ark Invest has also filed with the Securities and Exchange Commission to launch a bitcoin exchange-traded fund . The fund would trade under the ticker symbol "ARKB," if approved by the SEC. The price of bitcoin hit record highs earlier this year as more institutions embrace the digital token, among them PayPal, Fidelity and Square. Meanwhile, Morgan Stanley and Goldman Sachs were among the first banks to offer bitcoin funds to its clients. Still, it's been a roller-coaster ride this year for bitcoin amid crackdown in China, as well as pressure from the SEC. Bitcoin last traded $49,476.46 apiece after hitting an all-time high above $67,000 last month.
Catherine Wood, chief executive officer of ARK Investment Management LLC, speaks during the Milken Institute Global Conference in Beverly Hills, California, on Monday, Oct. 18, 2021.
Kyle Grillot | Bloomberg |