Many very bullish price predictions for bitcoin have started to emerge. It's hard to determine what's realistic and what's just nonsense. I recently came across this excerpt from the Winklevoss twins that predicted Bitcoin to hit $500,000 by 2030. My first reaction was, there is no way!
What Has History Shown?
Going back and looking at historical data, just 5 years ago Bitcoin was trading around $400. I'm sure at that point, predictions claiming it would hit $10,000 were considered unrealistic. That all changed in 2017 when prices hit $20,000 which was a 4900% increase.
Just for fun, let's say history repeats itself. Bitcoin is currently trading at $32,000 and an increase of 4900% in 5 years would take it to 1.6 million. Now I think that is extremely impossible. Any predictions claiming Bitcoin hit's 1 million are fantasies in my book.
What about for the Winklevoss's? Hitting $500,000 from its current price is a 1400% increase. In the past year, we've seen an increase of 480%. If we continued to see this growth over the next 9 years, the $500,000 price would actually happen.
Who Could Afford That?
I can't support these predictions though. At some point, there will be a level that nobody can afford. Who has the type of money just lying around to trade $500,000 for 1 Bitcoin? At those prices, there are MUCH better investments. There are not enough institutions to keep that afloat. Also, there will be a level that people want their money. If you bought bitcoin at $8,000 you will probably sell it way before $500,000 and I wouldn't blame you.
I think as prices continue to climb, there will come a price that investors say, "I think I want my money now". This could be 75K, 100K or 200K. If you're holding an asset valued at 200K, any chance of a market crash would cause panic selling. Each "dip" might be more than a dip.
Who knows though? I could be completely wrong. The future is unknown and that's what makes crypto so fascinating to me.
What are your thoughts? Where do you see bitcoin going in the future? I love hearing peoples predictions.