Bitcoin is unique.
It is the first of its kind.
Compared to other currencies, bitcoin is deflationary in nature because of its fixed supply cap.
It is not possible to print more than 21 million bitcoins into existence.
Think about this… There are roughly 35 million millionaires in the world. That would mean if every millionaire wanted to own an entire bitcoin, they wouldn’t be able to. Sadly there’s just not enough to go around.
You might ask, won’t this cause an issue with adopting Bitcoin as a digital currency?
Well, bitcoin’s deflationary supply would be a non-issue because it is divisible. You could use bitcoin up to 8 decimal places. And its smallest fraction is called a Satoshi.
1 Satoshi = 0.00000001 BTC
10 Satoshi = 0.00000010 BTC
100 Satoshi = 0.00000100 BTC
1000 Satoshi = 0.00001000 BTC
10,000 Satoshi = 0.00010000 BTC
100,000 Satoshi = 0.00100000 BTC
1,000,000 Satoshi = 0.01000000 BTC
10,000,000 Satoshi = 0.10000000 BTC
100,000,000 Satoshi = 1.00000000 BTC
Right now, it cost $7,130 US Dollars to buy 1 Full bitcoin.(11.23.2019)
For your $100 dollars it would get you 0.014 BTC, or 1,400,000 Satoshis.
When Bitcoin first appeared, no one really thought a Satoshi would have any real value.
But on 22nd May 2010, Laszlo Hanyec bought a pizza for 10,000 Bitcoins. (1 Bitcoin then was at USD 0.0025)
Today that pizza is worth $71,000,000 US Dollars.
So how do you value the price of one bitcoin?
Over the past 2 years I’ve gained a newfound understanding about money and how Bitcoin comes into play.
I used to assume money as anything that was given to me either in physical cash or 1’s and 0’s printed in my PayPal or bank account. It was purely blind trust.
To make an income, I provided my time and skills in exchange for money.
At the end of the day, I would keep a percentage (%) of my paycheck for myself and put the rest of it into a bank account.
That is how most people think about money. At least for the majority of people being employed by someone else.
This is how you make some money and hope that by your old age, you’d have enough to retire.
Unfortunately, that’s no longer the case.
Exhibit A – Dollar Historical Supply
The 2008 Financial Crisis was a huge wake up call for all of us.
Anyone who lives paycheck to paycheck was sold on the idea that $1 would always be equal to $1.
Today, that $1 is worth 1 cent in terms of purchasing power.
The stability of your currency is an illusion. Don’t fall for it!
Exhibit B – Decline of Your Purchasing Power
Don’t waste your time listening to people trying to teach you the secret to financial freedom.
The central banks can create money out of thin air faster than you can say Jack Robinson!
The game is rigged.
You work 40 hours a week year after year.
You slave away earning all that money.
Only to notice that everything around you is getting more and more expensive.
You end up needing to work extra hours, sometimes a second job or even taking on more debt just to make ends meet.
This is a silent theft that’s happening for decades on a global scale.
We were all born into this rigged game of monopoly ever since the gold standard was abolished.
Exhibit C – $9 trillion and counting
Money is a collective belief system.
We entrusted our leaders with this responsibility.
It ended up exploding in our faces. Most of us have been burned by this misplaced trust.
Why do you think the world is erupting in mass protests? From Chile, Ecuador, Lebanon, Barcelona, France, London, Argentina, Puerto Rico, Hong Kong, Iraq, Guinea, Bolivia, Algeria, Haiti, Egypt, Pakistan, Brazil, Sudan, Iran to Azerbaijan.
These uprisings and protests may be about something else entirely.
But what they’re really about, underneath it all, is money… and hopelessness.
And this is what’s driving so much anger, radical politics, and the growing racism in our society.
When money creation is left in the hands of a few men, there will be zero constraints.
Politically, it is always too tempting to create money when nothing is backing it.
The thirst for more power and control bites the very hand that feeds it.
We will not know for sure, how many more dollars would exist in the next decade.
It is purely a limitless function. An effective form of enslavement which is deeply insidious.
If You Want To Be Wealthy, Stop Focusing On Your Salary (Do This Instead): How do the rich get richer? Find out here…
This is becoming scary: using Oct instead of Dec data, Stock-to-Flow model fit improves to 99.5% R2! Model error was mainly caused by Nov2013 and Dec2017 ATH, so sampling without ATH gives less noise. Predicted #bitcoin prices increase: $100K (2020+), $1M (2024+), $10M (2028+)… pic.twitter.com/1WX6LOVxZW
— Plan₿ (@100trillionUSD) July 14, 2019
“Bitcoin is the drunk and Stock-to-Flow is the road home” Twitter only has a pic of the first link in my previous tweet, I like to also show the cointegration study: “Stock-to-flow is an important non-spurious predictor for the value of Bitcoin” @phraudstahttps://t.co/pyid3jgOm9
— PlanB [Jan/3➞🔑 ] (@100trillionUSD) August 12, 2019
Price Discovery for a New Kind of Scarce Currency
There is at least one analyst who thinks Bitcoin will go beyond $100,000 apiece by the end of 2021.
A pseudonymous quantitative analyst called @PlanB found that there is a statistically significant relationship between stock-to-flow and market price of bitcoin.
The likelihood that the relationship between stock-to-flow and market price is caused by chance is close to zero.
This model predicts that bitcoin will hit $100,000 before Christmas 2021.
Interestingly, until today no-one succeeded in academically rejecting this model; or even produce a better competing model.
What’s important to note is that “other cryptocurrencies” don’t exhibit such properties, particularly due to the lack of a credible monetary policy. Stock-to-flow and PlanB’s model is increasingly being discussed by mainstream banks:
- BayernLB – Is Bitcoin Outshining gold?
- Deutsche Bank – The end of fiat money?
Part of Bitcoin’s immaculate conception is Satoshi’s idea that money should be as scarce as gold and also come with a special, magical property of transmission over a communications channel like the internet.
Scarcity captures our consciousness. Antiques, time and gold all exhibit this property.
Now in the digital age, our attention has become somewhat of a currency with corporations and the media competing fiercely for it.
This attention is an abstract of our time. And our time on earth is limited.
With anything that’s scarce or limited in supply, it’s extremely costly to have more or to make more of it.
According to Nick Szabo, this scarcity is better known as “unforgeable costliness.” How do you preserve value without inflating it out of existence? Especially with the digitization of money.
To any centralized monopoly money, the supply balance will always be inflated.
The estimated number of bitcoins in circulation now is ~18.1 million, which will be capped at 21 million by 2130. This means the number of bitcoins available for trade will grow at a constant rate.
The limited rate of growth, which will continue to inhibit the release of new coins to a finite number, will tend to push up the price in astronomical proportions, writes Ellery Davies, Co-chair of Cryptocurrency Standards Association.
It is human nature that when there is a widespread perception that the availability of a commodity will become limited, there will be a mad scramble to hoard it.
That will work in favor for the value of bitcoin in the future as more and more investors eye a piece of the action.
Bitcoin Will Hit $1 Million … Eventually?
Valuing Bitcoin is pretty straight-forward.
On a long enough time-frame, we can only presume that since Bitcoin has a fixed supply of 21M units, that demand can only increase over time.
This would certainly leave an incredible upside to be captured by holders of bitcoin who are patient enough for mass adoption to kick in.
IBM’s Jesse Lund who heads their blockchain division certainly thinks so. In an interview at Think Conference, Lund suggested that $1,000,000 isn’t exactly crazy as it sounds since at that number, each Satoshi would be valued at $0.01.
He believes that speculators are currently holding back Bitcoin because they’re using it to make more fiat money. Adding more 1s and 0s to our bank balance sounds a little more insane especially when central banks continue to ramp up quantitative easing.
Hold on to your hats! We’re about to see which of these crazy predictions could come true.
1. McAfee – $1 million Bitcoin Prediction (December 31st 2020)
“Impossible for me to lose bet”
McAfee famously claimed in 2017 that if Bitcoin doesn’t move above $500K within 3 years, he would eat his own genitalia on national television.
And when he realized that the price of bitcoin would later exceed $5,000 by the end of 2017, he revised his prediction to $1 million by the end of 2020.
At the moment he is way off track from making a winning case for his audacious prediction. This Bitcoin Price Prediction Tracker shows exactly where bitcoin is, 496 days behind schedule and 90.9% below the targeted price point.
When asked on Twitter whether he’s worried about the prolonged crypto winter that has , he argued that “It’s mathematically impossible for me to lose that bet.”
He believes that like all revolutionary technologies, they take time to play out, but they’d always win, and no power on earth can ever stop the future from happening.
At the moment though, the price of bitcoin should be holding around $44,500 in order to follow a steady path towards $1 million per bitcoin. But like any revolutionary ideas, they don’t always follow a straight path to mass adoption.
Perhaps it would be wise to first learn whether Bitcoin is worth that kind of money in the first place… This Resource Library might help.
2. Zhu Fa – $740,000 Bitcoin Prediction (Next Bull Run)
Unlike John McAfee, Zhu Fa, co-founder of Poolin believes that bitcoin could surge between $74,000 – $740,000 in the next bull run.
While he didn’t give an exact date, he shares the sentiment that bitcoin is currently at its lowest point. He believes that now is the right time to buy & stock up on bitcoin because its dirt cheap.
He commented on WeChat in February echoing another Chinese billionaire, Zhao Dong who states that now is the time to accumulate bitcoin because the “only thing investors need is patience.”
Zhao Dong’s predictions are a little more modest, citing $50,000 per btc by 2021. He explains: “If you and I believe in the future of bitcoin, it’s best to hold as much as possible when nobody cares.”
This “could be” the last time the general population can afford to buy an entire $BTC
After 2021 – Bitcoin could move to a market price where most will only buy fractions
Global income per household is debatable, regardless, $BTC speculative value could be out of reach for most pic.twitter.com/GrmepQyNPp
— Josh Rager 📈 (@Josh_Rager) February 11, 2019
3. Naeem Aslam – $400,000 Bitcoin Prediction
Aslam a Market Analyst and columnist at Forbes who has appeared on CNBC and Bloomberg believes that the market has hit rock bottom and could surge to more than 10,000% to $400K.
With over a decade of experience in trading Forex, commodities and equities under his belt, Aslam is another Bitcoin bull who has recently suggested that the 15-month long bear market has come to an end, and we’re already seeing signs that the bitcoin price is already picking up.
4. John Pfeffer – $700,000 Bitcoin Prediction
John Pfeffer who heads his London-based investing firm, Pfeffer Capital; went up on stage in the annual Sohn Investment Conference in New York and recommended Bitcoin to some of Wall Street’s best hedge fund managers.
In the 23 years of history, the Sohn conference is where some of the markets top recommendations such as Amazon to Valeant Pharmaceuticals were presented for the first time.
Although he did no give a timeline in his prediction, he explains that he arrives at the figure assuming that Bitcoin completely replaces all gold bullion that’s privately held. That’s around $1.6 Trillion in gold.
The only caveat is that he places the odds of this happening is a mere 1%.
5. Cameron Winklevoss – $320,000 Bitcoin Prediction (10 years)
In an interview with CNBC in 2018, he explained that bitcoin could rise up to over 40 times its current price one day.
He hits at critics saying that it’s their “failure of the imagination‘. Bitcoin disrupts gold, and if you look at the properties of gold, scarcity makes gold gold!
Bitcoin is fixed in supply, so in other words, it’s actually better than scarce. What’s more it’s portable, fungible and more durable.
6. Bobby Lee – $333,000 Bitcoin Prediction in 2021
The co-founder of BTCC, a HK-based crypto exchange, Lee who has weathered two previous storms that saw bitcoin fell from the all-time high of $1,200 in 2013 to just $150 in 2015 believes that the current bear market is also reflecting this previous pattern.
Question is, do you have the stomach to weather declines of up to 87%? That is essentially the risk and rewards associated with Bitcoin.
Ultimately, he likes the $60,000 price level as it reflects a total circulation of $1 Trillion which will be a momentous milestone for BTC. After that, Bitcoin will achieve better price stability.
For the long term, he feels that $1 million per btc is not out of reach.
7. Tim Draper – $250,000 Bitcoin Prediction (2022)
Hodling the Future in Place of the Past “I think bitcoin is the future currency,” ~Tim Draper
Tim Draper believes that Bitcoin is more secure than the dollar. Keeping money in the bank will soon be an anachronism.
Fortune Favors the Brave
More than 30 years since Draper founded his company, with assets of over $5 billion, Tim is now a crypto entrepreneur putting millions of dollars into Bitcoin. Draper snapped up the Silk Road bitcoins auctioned by U.S. Marshals in 2014 and has become a crypto millionaire ever since. He acquired 32,000 bitcoins, at $18 million.
Read: What Tim Draper Told Forbes in an interview during a Tech Summit.
“I don’t know why anyone would want to go back to fiat when crypto is distributed, secure and global, while fiat is subject to the whims of political forces”. @timdraperClick To Tweet
CoinZodiac Recommends: Top 10 Reasons to Buy (More) Bitcoin Immediately
8. Thomas Lee – $125,000 Bitcoin Prediction (2022)
Tom Lee the founder of Investment advisory Fundstrat provides a positive outlook for Bitcoin in 2019. He states that “many headwinds of 2018 are turning into tailwinds.”
He expects Bitcoin to stage a recovery by the end of the year. At the moment he has reduced his year-end prediction at $15,000 per btc.
Billionaire Mike Novogratz predicts a $20 Trillion market for cryptocurrency that would also place bitcoin’s price well into the 6-figure mark. He adds:
Although he further explains that it won’t go there in a linear predetermined path.
9. Wences Casares – $1,000,000 (by 2027)
The CEO of Xapo in Palo Alto, California believes that Bitcoin has a huge case to make in his home country in Argentina. There, people are concerned about the local currency being printed out of value unlike the United States.
Casares is also a board member at PayPal, but he bought his first bitcoins in 2011.
He said at Consensus 2017 held in New York that Bitcoin could hit one million dollars as early as 2022, but said that it could be a decade or so before it reaches that milestone.
10. Chamath Palihapitiya – $1,000,000 (by 2037)
Another early investor of bitcoin in 2012. At one point he owned as much as 5% of all Bitcoin in circulation.
As the founder of Social Capital and the co-owner of the Golden State Warriors, Chamath predicts that Bitcoin may reach $100,000 in 4 years but it will ultimately touch $1 million in 2037.
He said, “This thing has the potential to be comparable to the value of gold…This is a fantastic hedge and store of value against autocratic regimes and banking infrastructure that we know is corrosive to how the world needs to work properly”
Questions to Ask yourself before Buying Bitcoin
- PlanB: Stock to Flow | Real-time chart
- DCA tool, save money over time
- Bitcoin isn’t a get rich quick scheme, it’s a don’t get poor slowly scheme. – @Jameson Lopp
How Satoshi Nakamoto Used the 1950’s Game Theory to Design a $100 Trillion System