Bitcoin Price Could Exceed 1 Million In The Long Run

Joseph Young published an interesting article on CCN on the future value of Bitcoins (BTC). He refers to an essay published on the research platform Kana and Katana last month written by Xapo founder and CEO Wences CasaresThe case for a small allocation to Bitcoin. In it, Casares said that the leading cryptocurrency may be worth more than $1 million in 7 to 10 years.

“In my (subjective) opinion those chances of succeeding are at least 50%. If Bitcoin does succeed, 1 Bitcoin may be worth more than $1 million in 7 to 10 years. That is 250 times what it is worth today (at the time of writing the price of Bitcoin is ~ $4,000).”

Wences Casares

According to Casares, a director at PayPal, investing in an emerging asset like the leading cryptocurrency poses risks and it would not be wise for an investor to invest anything more that can be possibly loose. However, he emphasized that it would be a mistake not to have any exposure to BTC at all.

I suggest that a $10 million portfolio should invest at most $100,000 in Bitcoin (up to 1% but not more as the risk of losing this investment is high). If Bitcoin fails, this portfolio will lose at most $100,000 or 1% of its value over 3 to 5 years, which most portfolios can bear. But if Bitcoin succeeds, in 7 to 10 years those $100,000 may be worth more than $25 million, more than twice the value of the entire initial portfolio.

Wences Casares

Even though we are still in crypto winter, i.e. in a bear market environment, Casares believes in the future of the cryptocurrency. The current bear market only works out the excesses of the last rally in 2017. During the rally, too many people buy too many bitcoins thinking that they will be able to sell them for a big gain very soon and that usually does not happen.

Currently, the leading crypto has a market capitalization of around $90 billion (17.6 million bitcoins in circulation multiplied by the price of $5,100). In case Bitcoin becomes the world’s standard of value and settlement it may have to be worth more than gold, Casares concludes. All the gold that was ever been mined is worth some $7 trillion. If Bitcoin is ever worth as much as gold each Bitcoin may be worth some $300,000. In case, Bitcoin will be worth as much as the world’s narrow supply of money it would be worth some $2 million.