Does this sound outlandish? Are we embarking upon another phase of Bitcoin is running, time for outrageous predictions?
While we could be seeing some of this, this price came from an article published earlier today. And, in actuality, it is not that outrageous a claim if one follows the logic.
Before we get into the price estimate, it is vital to discuss what is Bitcoin. To arrive at this conclusion, we have to believe that Bitcoin is digital gold. As we advance more into the digital age, we will see how things are valued changed. From this perspective, it is fairly logical to arrive at the outcome we see here.
As we can see here, the price target is derived by looking at the total market cap of the gold market. If Bitcoin is able to match that at some point, with the amount of BTC available, it will put the price near the $500K mark.
Therefore, we are confronted with another question: how likely is it that Bitcoin actually becomes digital gold and takes up status as such?
If one is to believe the likes of Peter Schiff, this is not going to be the case. Of course, Schiff has a track record for being wrong with his forecasts. The challenge that Schiff faces is he is part of the demographic change that is going to be taking place. In other words, he is a dinosaur.
Even though Schiff is on the younger end of the spectrum, he is a Baby Boomer. This is the generation where we find many of the gold bugs. These come from an era when money was viewed differently. For example, that generation, for the most part, remembers the United States being on the gold standard.
To contrast, the Millennials do not even remember a time when cash was the primary means of paying for things.
In short, we have a demographics change that is radically going to alter things. Millennials are on the side of Bitcoin while Boomers are gold people. The challenge is that Millennials are set to inherit tens of trillions of dollars from the Boomers over the next 15 years.
Where do we think this money will end up? Bitcoin or gold?
The truth is the Boomers will sell their gold to provide the cash to the Millennials who will end up buying Bitcoin. This is the trend that is already in place. Surveys are showing that this ratio is 9 to 1.
We have a shift toward greater technology (i.e. more digitization) plus the Millennials acquiring a great deal of wealth from the Boomers. These two scenarios paint a very positive picture for Bitcoin.
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