Will Bitcoin get to one million dollars?

In Business, Crypto
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From history, we’ve been taught that the get rich quick concept was just a myth and unrealistic; however, with the rise and returns from cryptocurrency, this has gradually started to become a reality. The market cap of all cryptocurrencies combined, at the beginning of last year was at $17.7 billion, but by the end of November, they were worth more ($325 billion). This could result in a 1700% increase in just 11 months. This achievement made within a year could take a lifetime worth of investment.

Crypto-experts strongly believe the party has just begun. At some point in time, It seemed impossible for Bitcoin to reach $10000, which it achieved soon enough; Now, some Bitcoin experts have projected it to hit $40000 per coin, while for some others, it is not bullish enough.

While speaking with CNBC, Altucher (a former hedge fund manager) said he believes that by 2020, Bitcoin will make a run at one million dollars; a statement that agrees with that made by John McAfee (McAfee founder and CEO MGT capital investments). He said further that there are about 15 million millionaires in the world today and all their financial investors will encourage them to buy a Bitcoin and earn some exposure. There’s also going to be a driven demand because only twenty-one (21) million Bitcoin will ever be minted.

There is a possibility that Bitcoin gets to one million dollars all-time high because:

  • People will prefer storing more of their wealth in Bitcoin in the future where they believe it to be more secure, thereby displacing assets such as Jewelry, precious metals and real estate etc.
  • The GDP of USA is far less compared to the world’s GDP. If USA’s GDP could be stated at 72 trillion dollars, then there is a very high probability of Bitcoin replacing all fiat currency and rated at 72 million dollars each.
  • Also, we could see that less than a billion of the 7 billion world’s total population contributes to its 72 trillion dollars economy. Some of them do not possess a bank account because they don’t see the need to use one. But with the help of Bitcoin, they could possess bank accounts’ giving them the opportunity to run their business on the global market which has never occurred before.

Everyone could easily start up a business, i.e. sales of beads & ornaments etc. with no barriers to laying hands on the necessary funds and utilizing them effectively. This will result in man’s output described as being exceptional and exponential, and by then, GDP will be estimated in Quadrillions or higher within a short period of time.

  • With the fall of fiat cryptocurrencies, spikes have emerged in Bitcoin’s adoption especially from Cyprus event and the Greek financial system. In this, a particular percentage of saver’s funds are taken over by the government.

There’s also an increase in Bitcoin adoption in Venezuela with local bitcoins.

  • Bitcoin cannot be taken over with authority, and when the need arises, could be easily transported to any part of the world. It cannot be taken from you unless someone else has access to your private keys; No other type of asset has these qualities. As Bitcoin continues to provide means of disconnecting one’s wealth from control, more people will realize this, thereby leading to Bitcoin’s exponential growth in value.

Though nothing seems impossible with Bitcoin; There’s a slim chance of yielding 10000% returns in the next three years because,

  • Bitcoin will need to be in a completely perfect position, which is for now, unrealistic.
  • Economists define money supply in a number of ways. M1 (the most widely used) refers to the sum total of all cash checking accounts. M1 is presently rated at $1 million, and with Bitcoin discarding other forms of money, each coin could be valued at $1 million. Larger money supplies, (M2, M3 etc.) that make use of certain bonds and savings account are much larger. It is unlikely that Bitcoin will be used for large money supplies because the money is not circulated, and when it is being loaned to the bank, it is immediately loaned out to someone else. This could push the value to over $3 million per Bitcoin ; this is very unlikely because, making use of all M1 concludes that there is no other form of money competing with it, whether digital funds or fiat money.
  • Bitcoin’s advantage (first to market) may not hold until the year 2020 because there is a very low barrier to entry into the cryptocurrency space. Anyone can create a blockchain as far as he or she has the money and time needed as well as someone who can effectively develop codes. With this, we expect more virtual cryptocurrencies to hit the crypto world each month making each of them a possible competitor of Bitcoin. There is also no guarantee that investors will prefer Bitcoin over all other competitors
  • Bitcoin’s future trading being listed by Nasdaq, CME group, Global markets and CBOE has made betting against Bitcoin possible which has never occurred before.

Possible Strategies

As unrealistic as it seems, we need to recall that $10,000 once seemed impossible, but later came to be. For Bitcoin to meet this target (getting to one million dollars) by the end of the decade, the measures explained below could be considered.

  • Bitcoin’s acceptance as a payment method will need to be expanded on a large scale. Though some retailers have accepted Bitcoin whole-heartedly, most of the major retailers have decided not to.
  • The update process made on both Bitcoin and its blockchain must pay immediate returns. The blockchain is the decentralized ledger responsible for all recorded and efficiently protected transactions. Recent updates made with a view to improving bitcoin’s blockchain capacity has succeeded but has neglected both transaction fees and settlement times. If future upgrades correct this pitfall, it could entice lots of enterprises.
  • There’s continual weakness in the value of the U.S dollars. This could scare potential investors away, thereby, going after other assets like gold. This needs to be checked and corrected. However, bitcoin’s coin limit valued at $21 million gives it some “infiniteness” before potential investors.
  • Bitcoin’s market cap would need to be in the range of $19 trillion to $21 trillion worth. It might reach equilibrium or be slightly ahead of gold’s ounces presently rated at 7 trillion dollars.
  • Lastly, there is a need for the excitements of retail investors to keep driving Bitcoin higher. Bitcoin is free from external influences, i.e. governmental bodies, and therefore, solely relies on investors to help increase its price per coin.

 

This was a guest post made by a collective member of Republic of Software. Their opinions are their own and do not reflect those of Republic of Software Inc as a company.

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