With Bitcoin’s incredible year last year and hitting a new all time high in January 2021, many are wondering how high can Bitcoin go. We’ve taken a dive into some interesting looks at the future of Bitcoin, and where the price could possibly go. We’ll be covering the age old Bitcoin gold debate as well as take a look at how Bitcoin could reach $1 million in 10 years time.
Bitcoin Bull Run of 2020
Following several years in a bear market, Bitcoin emerged from the ashes of the global market crash instigated by the pandemic. From trading at $5,000 in March, the cryptocurrency underwent a halving in May and steadily progressed to a new high on 30 November. It didn’t stop there. After a month of hitting new highs, it eventually established the latest all time high record sitting at $41,941.56 on 8 January. The year saw many big moments for the cryptocurrency (all time highs aside). After the halving and a large influx of institutional investments, the adoption rates increased considerably and many new investors entered the market. Some used Bitcoin to hedge against macroeconomic risks and inflation, while others looked to it as a valuable store of money, akin to or better than gold.
The Bitcoin Gold Debate
When looking at how high can BTC go, one strong argument is the Bitcoin gold debate. Gold has been a staple store of value for centuries and a trusted investment for many. As Bitcoin claimed the title of best performing asset over the last decade, as well as notoriously being referred to as digital gold, it is worth exploring the differences.
While both assets are scarce commodities (gold as a precious metal that needs to be mined and Bitcoin with a limited supply of 21 million coins), Bitcoin is more divisible and portable than gold. Currently, the gold market is valued at $9 trillion while Bitcoin’s market cap is at $610 billion. If Bitcoin is indeed a stronger store of value based on the aforementioned characteristics (and many more), then BTC is destined to reach the $9 trillion market cap that gold currently has. If this were the case, based on the current circulating supply 1 BTC would need to be worth $500,000. That would require a 1,462% increase in price, not impossible considering the price has already increased 24,000% since 2013.
In conclusion, the Bitcoin gold debate places Bitcoin’s worth in the coming years at $500,000.
Bitcoin Worth $1 Million In 10 Years Time
Lou Kerner, the Founder and Managing Partner of The Social Internet Fund, and Managing Partner of The Israel Syndicate on AngelList, shared his thoughts and research on this one. Based on this theory below, he states that Bitcoin is likely to reach a market cap of $18.5 trillion in the next 10 years.
The atomic unit of a dollar is $0.01, with 100 of these making up $1. The atomic unit of BTC is a satoshi (known as sats for short), and there are 100 million of them in 1 BTC. Kerner then speaks of a dollar sat (dsat) which refers to 100 satoshis. According to him: “If 100 of the atomic units of Bitcoin reaches parity with 100 of the atomic units of a dollar, then we have bitcoin [at] $1 million.” With 1 dsat (100 satoshis) worth $1, the entire market would be valued at $18.5 trillion (factoring in 2.5 million lost Bitcoin).
Comparing the growth to that of Apple, he states that Apple hit the $1 trillion market value in August 2018, 42 years after launching. This equates to $64.7 million in value created everyday for 42 years. In just over two years the company gained another $1 trillion market value. This therefore equates to $1.3 billion in value creation everyday for those 747 days. Since the market crashes in 2020 following the pandemic, Apple has still managed to average $4.7 billion in value creation everyday.
If Bitcoin were to average the same, it would hit a market cap of $18.5 trillion in 2031. That would require a 36% growth rate per year for the next 10 years, challenging but not inconceivable.
How High Can BTC Go?
Considering the innovation that Bitcoin has brought both to the financial and technological worlds, there is no limit to how high the BTC price could go. The cryptocurrency has shown incredible growth and stamina over the last decade, and is unlikely to stop. As more corporate companies invest in the Bitcoin market, the more likely the cryptocurrency is to continue gaining value and respect outside of just the crypto market.