Bitcoin is going to go higher and it won't have anything to do with payments...
In my opinion, bitcoin's biggest draw currently has nothing to do with its potential uses as a global currency that would compete with and possibly someday replace fiat currencies.
That may happen at some point, but I don't think it will happen any time soon.
There are a whole host of reasons why governments don't want to give up control over their currencies and that is not even taking into account the problems that a deflationary currency might cause in terms of economic activity.
No, I think it is going higher for another reason...
Why I think it is going higher:
Bitcoin to me is comparable to that of digital gold.
It does just about everything gold does, only it does them better.
It's supply is fixed and known. It isn't controlled by any single government. It is portable and easily transferable. It isn't correlated with other financial assets. Among several other reasons...
The only thing gold has on bitcoin is about a 10,000 year head start as a widely accepted store of value.
Ok, so it's a better gold, why does that matter?
Currently gold is roughly an $8 trillion dollar market.
I see no reason that bitcoin doesn't capture at least 10% of the gold market over the next 5 years.
In all honestly, it should probably capture a lot more of it but we'll conservatively stick with that number.
At 10%, that would give bitcoin a market cap of roughly $800 billion.
That would represent roughly a $40k-$45k price per bitcoin depending on how quickly it happens.
Which means...
If bitcoin captures just 10% of the gold market, we are looking at a 13x return from current levels!
And that isn't factoring in FOMO or bitcoin being widely accepted as a global payment system, which would likely send prices even higher than those numbers.
Bitcoin's future is bright folks, even if it never catches on for payments.
Stay informed my friends.
Image Source:
https://bitcoinist.com/bitcoins-maturity-as-digital-gold-could-easily-triple-its-market-cap/
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Ive read a couple of articles recently on Steem on inflation and not sure bitcoin will ever become currency because it has no inflation. Small inflation is what keeps people using something as curency as there is always a downward force on the value of the asset so it decentivizes hodling. On the other hand since bitcoin had no inflation it encourages hodling which is the exact opposite of what you want for a currency.
I could be completely wrong, but I can see why Bitcoin will more than likely always be a store of value rather than an every day currency.
Yep exactly. Well said.
I think thats the use case bitcoin core devs are targeting. Bitcoin will be used for a relatively small number of large payments, acting as a settlement reserve currency (similar to gold before FIAT).
However, with off chain transactions and the lightning network small transactions will still be possible (with low fees), but BTC will most be held as a store of value.
Someone please correct me if I am wrong!
Nope I think you are spot on. That is how I see things playing out as well.
Bitcoin will be the digital gold hehe :)
I think it already is.
yes hehe :)
Bitcoin isn't gold and it isn't anything like gold.
Bitcoin's supply is limited and the supply will stop in the future. Gold is only limited to the supply discovered on Earth...as long as we don't mine any for whatever reason in any asteroids. Gold's value may actually plummet as soon as we start asteroid mining, as the "supply" will skyrocket as we bring it back. The value might crash as soon as asteroid mining even becomes more of a reality.
Bitcoin's was a little harder to use than other cryptos and more expensive, for a while, because the idiots didn't adopt updates fast enough to keep up with the tremendous rise in price and use. Now it's a lot easier to use. Gold is a bitch to use. Okay, maybe they're a bit similar there...but they're really not. From Wikipedia: "The standard gold bar held as gold reserves by central banks and traded among bullion dealers is the 400-troy-ounce (12.4 kg or 438.9 ounces) Good Delivery gold bar." That's almost 30 pounds. According to Coinmill that's worth $808,964.37. So, if I wanted to, I could carry around $1.6 million in gold, with only slight aggravation. 50 pounds isn't that heavy. But I wouldn't really wanna transport much more than that. Bitcoin is weightless however, and has no limit to the amount that can be transferred. There's just a service fee, to verify the transaction. Thankfully, that fee is much lower now. Of course, most people don't move around that much money. If they actually used gold, which no one does anymore, they would use gold coins, which were constantly shaved and whittled down until they were nothing and were pretty much useless as a currency because of it. Plus, of course, the governments were mixing in all sorts of different metals, making it so they weren't really even gold coins, but a combination.
People have been trying to label Bitcoin as digital gold because it's limited supply...but it's not. The analogy sort of barely works a bit. You can say it's supply is limited, like gold, but calling it digital gold just doesn't work. Gold was a physical asset that we assigned value a long time because of it's ease of use. We're lucky we didn't end up using lead. Guess, even though it was easy to mould into shapes, it just didn't look as pretty, and was still pretty damn heavy. Bitcoin is something new and entirely different. It's not shiny. It's not pretty. It's not heavy. You can't mould it into a coin or a watch or a ring. The only thing that is similar is the limited supply...which gold might not have in the near future, depending on how much money the morons in the government put into space funding.
The point is that roughly $8 trillion is parked in gold mostly as a store of value. Bitcoin likely eventually captures a portion of that store of value market.
I think Bitcoin will capture more of the newer generation's investment. Many of the older generations will continue to invest in gold. Of course, in 40 years or so when the gold market crashes because of asteroid mining, then Bitcoin will seriously take off. :P
"Cádiz (España) Anillo Fenicio de Casa del Obispo"
When BitCoin makes things as beautiful as these, it is one of the most coveted noble metals in jewelry, space engineering, medicine and thousands of other uses that the BTC will never be able to match.
I repeat, the BTC Bitcoin is not worth a single €
An affectionate and sincere greeting
The market says it is worth $3,400 currently, and I am betting the market will say it is worth a lot more than that over the next 5 years.
Hope you are correct sir 🧐
It will take a crash in traditional financial markets before more money flows into crypto IMO. Metals have been patiently waiting for their time to come back like they did in 2008-2011. Stock markets have been strong so far the past month but I think they are long overdue for a real correction that would send the DOW back to 16K-18K.
I don't think we even need that. As funds and endowments and many other large institutions all start taking allocations of anywhere between 1%-6% in bitcoin in order to model the 'perfect risk adjusted portfolio', we will see prices go up rather significantly.
whatever everyone says or believes, I am really looking forward for you prediction to come true. It would be awesome. Will it have any effect on steem or SBD?
Not sure, but it did the last time. If everything is still priced in terms of BTC when this next run happens, it likely will affect them as well.
The moral of this story invest in Bitcoin!
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Yep, though this is not financial advice. Just the opinion of a random blogger. :)
;)
You'd also have to factor in that about 25% of BTCs have already been lost. So they'd be worth even more. Those lost BTC have essentially been "burned" and won't ever be recovered...
Yes, though that is already reflected in the $60 billion dollar market cap. Perhaps it would be at $800 billion as well?!
I think that it ahas definitely the potential to eat into the market share as you explain given the store of value concept alone. When you add the evolution of money from tangible to intangible and the flexibility bitcoin brings, it could mean so much which is why it could be better off than gold in the long run.
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Yep exactly. 10% of the gold market is my base-case valuation for bitcoin over the next 5 years. It could very well be a lot more than that though.
@jrcornel, Definitely Bitcoin is big stuff and very underrated at this moment. Your Opinionated calculations are boosting. Let's hope for the best. Stay blessed.
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STOPTo support your work, I also upvoted your post!
have you seen this? https://link.medium.com/J3VkkqXI0T
Very interesting analysis of Bitcoin price based on Bitcoin Market-Value-to-Realized-Value (MVRV) Ratio
Good stuff, thanks for the share!