Share this article
Bitcoin Undervalued By Over $200, Investment Bank Report Finds
A comparison of bitcoin investment to gold investment lead investment bank, Needham, to price the cryptocurrency at more than 50% its current value.
Updated Sep 11, 2021, 12:12 p.m. Published Mar 29, 2016, 6:57 p.m.
Investment bank and asset management firm Needham & Company has released a report that concludes that bitcoin is currently undervalued by 58% based on today's price.
STORY CONTINUES BELOW
Don't miss another story.Subscribe to the Crypto Daybook Americas Newsletter today. See all newsletters
values bitcoin at $655, compared to about $412 today and advises that investors buy shares in the Bitcoin Investment Trust (GBTC), a vehicle for speculators to invest in bitcoin without actually buying and holding the asset.
Spencer Bogart, author of the report and Needham's newly appointed equity research associate in charge of bitcoin and blockchain, said that the report is a vote of confidence in an emerging technology many have questioned as a stable store of value.
Bogart told CoinDesk:
"We believe bitcoin has value as both a digital gold and as a payments channel."
Currently, there is $74bn worth of gold held in exchange-traded funds (ETFs) around the world, according to the numbers used in the report. Of bitcoin’s market cap of $6.3bn, Bogart estimates roughly 75%, or $4.8bn consists of money being treated as an investment.
That’s 6% of the value of gold ETFs, the report said, a number which the investment bank predicts could increase 25% by 2020.
Bogart used the percentage of bitcoins currently being held as an investment and compared it to investment in gold ETFs to calculate the estimated value of $655.
Emerging consensus
In June 2015, investment firm Wedbush published it own report, predicting bitcoin's price would increase to $600 over the 12-month period following its release.
Compared to Needham's report which valued GBTC at $62, Wedbush put the number at a comparable $60 per share.
According to Bogart, one factor that has lead to such a large difference between the current listed price of bitcoin and the price of bitcoin Needham projects is the rise in popularity of non-bitcoin blockchains using variations of the technology on which bitcoin is built.
While companies like Overstock's tØ are building top-level networks that ride on top of the bitcoin blockchain, other startups are building on new blockchains. Of late, Ethereum, a blockchain with the promise to decentralize more than just the exchange of value is being widely experimented with by major institutions, though they are using a permissioned version of its distributed ledger.
Most recently, the Depository Trust & Clearing Corporation (DTCC), announced it would build a blockchain proof of concept in partnership with Digital Asset holdings. But as experimentation continues, Bogart continues to believe bitcoin will play a central role.
"We think there’s a strong possibility that bitcoin will be the nucleus of security for all these blockchains," he said.
GBTC's potential
The second section of the report focuses not on bitcoin but on the Bitcoin Investment Trust (OTCQX: GBTC), a product of Grayscale Investments designed to address investor concerns over investing in bitcoin.
Founded by investor Barry Silbert and launched in mid-2015, the GBTC requires a minimum investment of $25,000.
Investment shares in the trust are worth approximately one-tenth of a bitcoin in an effort to directly tie them to the cryptocurrency's value. As of 31st December, there were 1,476,500 shares issued and outstanding, according to the company’s annual report. Grayscale currently manages $62.6m via the GBTC.
A representative of Grayscale told CoinDesk the company does not respond to third-party reports.
Disclaimer: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Grayscale.
Trading image via Shutterstock
More For You
What to know:
- As of October 2025, GoPlus has generated $4.7M in total revenue across its product lines. The GoPlus App is the primary revenue driver, contributing $2.5M (approx. 53%), followed by the SafeToken Protocol at $1.7M.
- GoPlus Intelligence's Token Security API averaged 717 million monthly calls year-to-date in 2025 , with a peak of nearly 1 billion calls in February 2025. Total blockchain-level requests, including transaction simulations, averaged an additional 350 million per month.
- Since its January 2025 launch , the $GPS token has registered over $5B in total spot volume and $10B in derivatives volume in 2025. Monthly spot volume peaked in March 2025 at over $1.1B , while derivatives volume peaked the same month at over $4B.
More For You
Japan’s Higher Rates Puts Bitcoin in the Crosshairs of a Yen Carry Unwind
A stronger yen typically coincides with de-risking across macro portfolios, and that dynamic could tighten liquidity conditions that recently helped bitcoin rebound from November’s lows.
What to know:
- The Bank of Japan is expected to raise interest rates to 0.75% at its December meeting, the highest since 1995, affecting global markets including cryptocurrencies.
- A stronger yen could lead to de-risking in macro portfolios, impacting liquidity conditions that have supported bitcoin's recent recovery.
- Governor Kazuo Ueda indicated a high probability of a rate hike, with officials prepared for further tightening if their economic outlook supports it.
Top Stories
