There are some wild forecasts out there. Probably the most eye-opening is the idea of $1 million bitcoin. This, on the surface, seems absurd yet it is very possible.
One thing I learned is that we can never underestimate the markets. No matter how much logic is given against this idea, markets are not logical. Therefore, I never debate a forecast or call it unlikely.
Decades ago, the idea of 30K Dow was absurd. People though that is looney in the 1990s (or whenever the book was written). We are now just over 37K on the Dow.
The insane became reality.
So what is the deal with bitcoin? We should take a look at this.
Forget the values and tenets of Satoshi Nakamoto. Those are now dead. Over the last couple weeks I discussed the hijacking of bitcoin. Even Gary Gensler is laughing at the absurdity of it all.
Bitcoin is now in the hands of Wall Street. If you thought Michael Saylor was a whale, think again. Moby Dick is going to enter the arena and he is hungry. We are going to see the likes of Blackrock, Goldman, and JPMorgan with their hands all over this.
No longer is bitcoin about sovereignty. The dream of a medium of exchange is now dead (not that it was feasible before this). The big money players are going to take over.
What does this mean?
In [short, while the tenets of freedom are gone, it could be a major money maker. For the green candle people, this could be a major boom.
Bitcoin is now an asset class, one that Wall Street is going to play with. Do not believe that this is the last of the products that these financial institutions bring out. In fact, it is just getting started.
Wall Street will be like a kid with a new toy. It is going to all end up in the hands of major players.
For that reason, $1 million BTC is not the craziest thing in the world.
What is going to drive the value?
At this point, it doesn't matter. The reality is the Bitcoin network is old technology that had flaws. As a database, it is rather useless information. Blockchain is a ledger, mostly financial. There is a reason why banks and other financial entities do not provide access to a lifetime of statements. Does anyone really care about their Visa bill from 20 years ago? Or even 4 years ago?
Ordinals could have some potential yet there is great divide among the community. Also, Blackrock is already investing in bitcoin mining companies meaning that could end up centralized. For now, however, the network is still free from their clutches.
That said, what does it really bring to the table. If the coin is being hijacked, then we are left with the database. As stated, that has rather low value as it stands.
This does not mean that bitcoin doesn't provide a valuable service. While the network is still uncontrolled, we can see the need to transfer value without counterparty risk. This is something the world will always need especially if there is massive liquidity.
However, the lack of clarity among most people, especially regulators means the coin (asset) is mistaken for the network. This is what created the green candle crowd.
When this happens, the regulators step in. Also, this gets the money managers salivating because they have something else to offer their clients.
And here we stand.
For that reason, value is going out the window. Price is dependent upon market activity, supply floating on the open market, and how manipulative the major players are. As they add more products, this could stimulate demand, driving price higher.
Therefore, the $1 million question comes down to how much Wall Street builds on top of this asset. There are trillions in repo contracts set up daily using US Treasuries. Something like this would make the price of bitcoin moon. Some believe a $20 trillion market cap is not possible....
....again, do not underestimate markets.
Bitcoin might have a rosy future as an asset class. This is something that it probably was destined for from the start. There were flaws in the design for electronic cash, something that Satoshi, whomever he or she was, did not understand. It is a common mistake among the masses who do not truly understand money to the degree required.
Fixed money always pools. This is something that will help the price of BTC.
So yes, bitcoin could hit $1 million. While it might not be probable, it is possible.
