Bitcoin falling out of favor? Cathie Wood lowers target price to $300,000, while stablecoins are capturing emerging markets

ARK Invest’s Cathie Wood has lowered her long-term Bitcoin price forecast by $300,000 and warned that stablecoins are eroding Bitcoin’s role as a store of value in emerging markets. She previously predicted Bitcoin could reach a maximum of $1.5 million by 2030, but now believes this should be reduced by about $300,000 due to the rapid growth of stablecoins.

Why Did Cathie Wood Lower Her Bitcoin Price Forecast by $300,000?

(Source: DefiLlama)

“Stablecoins are replacing some of the roles we thought Bitcoin would play,” Wood said. The investment queen, known for her bold predictions, has long been a strong supporter of Bitcoin, forecasting a peak of $1.5 million by 2030. However, the rapid rise of stablecoins has prompted her to reassess that outlook.

“Given that stablecoins are serving emerging markets in ways we originally expected Bitcoin to, I think we can reduce our bullish target by about $300,000, simply because of stablecoins,” she explained. “I believe the expansion of stablecoins here is happening much faster than anyone anticipated.”

This downward revision doesn’t mean Wood has lost faith in Bitcoin. Despite the lowered price target, she still views Bitcoin positively overall, calling it a “global monetary system” and a store of value similar to gold. The key difference now is that Bitcoin’s role as a store of value and inflation hedge is being partly replaced by stablecoins in certain markets.

Differentiating the Roles of Bitcoin and Stablecoins

Bitcoin: Global currency, long-term store of value akin to gold, inflation hedge

Stablecoins: Tokenized cash on blockchain, practical payment tools in emerging markets, dollar substitutes

This differentiation impacts Bitcoin’s price outlook because it was originally expected to serve both as a store of value and a medium of exchange. Now, stablecoins are capturing market share in transactions and short-term savings, which could mean Bitcoin’s overall market potential is smaller than previously estimated, as some demand shifts to stablecoins.

Wood’s downward adjustment isn’t unique. Galaxy Digital recently revised its 2025 Bitcoin price target downward from higher levels to $120,000, reflecting changing market dynamics. These adjustments indicate that institutional investors are reevaluating the structural landscape of the crypto market.

Explosive Growth of Stablecoins in Emerging Markets

(Source: Chainalysis)

By 2025, the total market cap of stablecoins is projected to surpass $300 billion, continuing its rapid growth. This figure is remarkable considering that just two years ago, stablecoins’ total market cap was under $150 billion. Doubling in size demonstrates accelerating adoption, especially in emerging economies.

According to Standard Chartered, by 2028, dollar-pegged stablecoins could siphon over $1 trillion from traditional banking systems in emerging markets. This forecast is based on current growth trends and strong demand for dollar-stable assets in these regions. Countries like Venezuela and Argentina, suffering from hyperinflation, sanctions, or capital controls, are particularly affected, pushing residents to hold dollars or dollar-pegged stablecoins to preserve their purchasing power.

Chainalysis data shows that from 2022 to 2024, stablecoins have dominated cryptocurrency transactions in Latin America. This dominance reflects local needs: in countries like Venezuela and Argentina, local currencies are rapidly depreciating, making stablecoins a vital store of value.

According to IMF data, Venezuela’s annual inflation rate soared to 269% in 2025, forcing millions to turn to dollar-pegged stablecoins like Tether’s USDT for savings. In such extreme inflation environments, holding local currency means wealth erodes daily. Stablecoins offer a way to hold dollars without a bank account, especially critical where banking services are limited or currency controls are strict.

Venezuela’s strict currency controls and dual exchange rate system have made stablecoins a reliable alternative to physical or bank-held dollars. Government restrictions on foreign exchange make it difficult for ordinary residents to access dollars through legal channels. Stablecoins provide a decentralized solution that bypasses these restrictions.

Why Are Stablecoins, Not Bitcoin, Leading in Emerging Markets?

While both Bitcoin and stablecoins are cryptocurrencies, their use cases in emerging markets differ fundamentally. Bitcoin’s volatility makes it more suitable as a long-term store of value and speculative asset, rather than for daily transactions or short-term savings. When a Venezuelan worker needs to save their weekly wages, they prefer stability over the potential 10% or more price swings in Bitcoin over a few days.

Stablecoins meet this need perfectly. USDT, for example, is always pegged 1:1 to the USD, meaning its purchasing power remains stable day-to-day. For residents in hyperinflationary countries, this stability is invaluable. They don’t need Bitcoin’s potential for long-term appreciation; they need a tool to protect their current wealth from inflation.

Moreover, stablecoins are more practical for payments. Merchants are more willing to accept stablecoins because their value doesn’t fluctuate during the transaction process. In Latin America, more businesses are accepting USDT payments, combining crypto’s convenience with dollar stability.

In 2024, reports indicated that Venezuela’s government was using stablecoins to bypass U.S. sanctions and facilitate international oil trade. This development shows stablecoins’ applications have expanded from individual use to national-level strategies. When traditional banking systems are hamstrung by sanctions, stablecoins provide an alternative international settlement channel.

Impact on Bitcoin’s Long-Term Outlook and Repositioning

Cathie Wood’s downward revision reflects a significant shift in market perception: Bitcoin may not be “everything.” Early supporters envisioned Bitcoin as a multi-purpose asset—store of value, medium of exchange, and accounting unit. Now, the market is naturally differentiating these functions.

New Division of Roles in the Crypto Ecosystem

Bitcoin: Digital gold, long-term store of value, institutional asset allocation, systemic risk hedge

Stablecoins: Daily transactions, short-term savings, cross-border remittances, dollar substitutes in emerging markets

Smart Contract Platforms (ETH, SOL, etc.): Decentralized applications, DeFi, NFTs, tokenized assets

This specialization isn’t a bad thing. It could make the entire crypto ecosystem healthier and more sustainable. Bitcoin can focus on being the premier store of value without the burden of supporting payment networks. Stablecoins can focus on providing fast, low-cost payment solutions.

Looking at Wood’s $300,000 reduction, it suggests she believes stablecoins are diverting about 20% of Bitcoin’s potential market (30,000 / 150,000 = 20%). This proportion highlights the importance of emerging markets in Bitcoin’s overall use case. If Bitcoin eventually reaches $1.2 million (down from $1.5 million), that’s still a 12x increase from current prices around $100,000—an extremely optimistic long-term outlook.