Would Bitcoin's Share Value Become 1 Million Dollars?

  Would Bitcoin's Share Value Become 1 Million Dollars? Bitcoin's share value could reach $1 million sooner than expected. According to many analysts, the price of Bitcoin (CRYPTO:BTC), which is currently $ 35 thousand, is already very high. The truth is, the crypto asset is already heavily used as a store of value today, and this core utility of Bitcoin could potentially increase to $1 million per coin.

Subtracting savings from inflationary currencies

Bitcoin is often called "digital gold", but the situation is more complex. Gold has historically functioned as the preferred store of value from a monetary perspective. Some other assets have also acted over time as alternative stores of value under the current fiat currency standard. When a currency like the US dollar is inflationary, people often look for alternative investments such as traditional stocks, real estate, and government bonds to keep their savings from depreciating. Cryptocurrencies have also become the most important part of this list of alternative investments.

Reach $1 million

Although 6.25 new Bitcoins are currently mined by miners approximately every ten minutes, the total supply will be capped at 21 million. This means that a $1 million Bitcoin price would equal a total supply value of $21 trillion.

Is this assessment realistic?

The size of the global bond market was recently announced as $119 trillion by the Securities Industry and Financial Markets Association (SIFMA). At the same time, the yields earned on many of these bonds are at an all-time low. In fact, considering that these bonds have a negative yield of $18 trillion, we can see that the idea is not so crazy. Bridgewater Associates Chief Investment Officer Ray Dalio recently said he personally prefers to own bonds. Suppose that 10% of the global bond market ($11.9 trillion) of holders want to sell their holdings for Bitcoin. These individuals cannot do this at current prices. Because there is currently less than

Bitcoin's share value could reach $1 million sooner than expected.

$1 trillion in Bitcoin, and only a subset of the total Bitcoin supply is offered for sale at any price. In other words, bondholders cannot buy this amount of Bitcoin. This means that the price has to increase drastically to take over buy orders. This is a simple case of supply and demand. In a second example, let's imagine that a quarter of the gold market has moved to Bitcoin. That would equate to another $3 trillion of buying pressure. Suppose two percent of the roughly $300 trillion held in global equities and real estate markets has moved to Bitcoin. Then that would be $6 trillion. So in short, we're looking at $20,9 trillion of hypothetical buying pressure across these four markets (bonds, gold, equities, and real estate), and the opportunity to rise is potentially exponential. Of course, not all assets can be converted to Bitcoin. While this buying pressure is unlikely to happen tomorrow, Bitcoin will certainly benefit the markets as an exciting new asset class. Bitcoin's share value could reach $1 million sooner than expected.  

Source: The Motley Fool

 

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