How Valid are Big Numbers for Bitcoin in Coming Years?
It’s not clear where the numbers are coming from but venture capitalist, Tim Draper, seems to have a lot of them. Last month, he made a prediction that the price of Bitcoin will rise to $250,000 in the next four years.
Now, in yet another forecast, DealStreetAsia reports that Draper believes the total crypto market cap will rise to about $80 tln by 2033 – a staggering ~40,000% increase from the current $200bln. This could see Bitcoin price, going by its current over 50% market dominance level, at more than $2 mln each. Speaking via a video call at the DealStreetAsia PE-VC Summit 2018 in Singapore, he hinges his prediction on the transformative effect of cryptocurrencies just like the rise of the internet.
Though Draper’s prediction has been right in the past when he predicted Bitcoin will reach $10,000 in 2014, there are other indications that his recent claims could be close to being valid even if not as exact as he’d predicted.
Adoption as global reserve currency
A truly scarce form of money with a code that can constantly be improved, the top digital currency stands a chance to be a global reserve currency. Its value will rise if used as an acceptable cross-border and inter-organisational payment settlement instrument that is better than fiat currency and gold.
Looming financial crisis
Some of the economists that predicted the previous financial crisis are at it again. They claim the seed of another crisis has been sown in the world economy and is being watered through huge corporate debt and the prospect of rising interest rates in the United States. If this happens, it will be an opportunity for Bitcoin to prove itself since it was created as a remedy for such crises.
There’s also been growing interest in Bitcoin products among top financial institutions. From Goldman Sachs to ICE’s Bakkt, Citibank to Morgan Stanley, a fraction of institutional money will flow into the crypto space or, at least, give credence to the market when their products are eventually rolled out.