Could bitcoin hit $1,000,000 by 2022? (warning:click bait)

Let me start this article by stressing that this is not financial advice and the metrics I am looking at are very arbitrary. I’d just like to illustrate a point about price predictions…

I’ve been researching price predictions from 2017 and earlier just to compare with the predictions coming out today. This is hardly the best way to create an accurate price prediction, but it does give us some perspective on humans propensity for overestimating or underestimating based on their bias and the fact that everything is influenced by an unimaginable variety of factors.

I won’t summarize what I found, you can take a look at this old Bloomberg article from August 2017.

Bitcoin was pushing $4500 and people were predicting a 2x by the end of the year, at least those were the predictions Bloomberg cared to share. I believe there were 20k predictions as well, and whether or not it will continue to be accurate, Plan B’s stock-to-flow model has predicted bitcoins price pretty accurately up until now, with a few short term deviations.

The most fun prediction is the $50k in 2027 because obviously we smashed that in 2021.

Most people would have thought you were crazy predicting a 20k bitcoin in 2017 though, and there may have been manipulating factors that took us there (tether printing, bitcoin futures launch, insane FOMO etc.). In fact, if everything played out naturally with less manipulation and less premature hype, $10,000 would have been a more than reasonable price for BTC and wouldn’t have contradicted the stock-to-flow model long term.

The over exuberance led to the a huge pump 2x bigger than conservative bullish predictions.

Now the conservative bullish estimates are $100,000 to around $250,000 (although I’m not sure how conservative the latter would be).

We could end up seeing bitcoin go much higher if enough FOMO kicks in…like MUCH higher. Bitcoin is moving towards competing with both gold and the USD at this point. When everything starts being priced in bitcoin, the sky is the limit because at that point, we aren’t even going to be thinking about how much one bitcoin is worth, we’ll be thinking about how much fiat currencies and other assets are worth, bitcoin will be the standard.

As a deflationary asset with a limited supply, we are really exploring new territory here. What happens if there are 10 or 20 or 100 Michael Saylor’s, billionaires who decide to put all their wealth into bitcoin. What will THEY be willing to pay?

It’s hard to imagine 100 Michael Saylors right now but just keep printing dollars and see what happens.

On the other hand, it’s important to consider that not all wild cards will turn out positive, and with enough stacked against it, the same way bitcoins price was inflated and then deflated in 217-2018, there isn’t really anything stopping the opposite from happening.

Let’s say Russia adopts bitcoin as legal tender and the other super powers and g8 nations decide they want to criminalize bitcoin this late in the game to protect the USD. I think it’s highly unlikely, but I have no doubt in my mind this would lead to a long bear market. Would it kill bitcoin? I don’t think so. Would it stop it’s upwards trajectory? Short term, probably. Long term probably not.

What if hackers get into all of our gmail accounts or coinbase accounts? Mt Gox didn’t kill bitcoin but it took a while to recover.

What happens if Michael Saylor is arrested and it scares other billionaires from following in his footsteps? What if El Salvador is seriously attacked for adopting bitcoin?

Will any of it kill bitcoin? It could, but it probably won’t.

We have some incredibly strong technology with some really bullish indicators and adoption patterns. Still, I’m not about to have religious faith in Bitcoin, anything can happen.

I’ve seen a lot of people making predictions based on the four year cycles and I was too for a long time, but I think three strong forces are fighting against this. First is a balance between self fulfilling prophecy and things being priced in prematurely. The other force is manipulators. Manipulators want to trick you and they have the means to do so, so I think bitcoins price playing out exactly like 2013 or 2017 is extremely unlikely. It will rhyme, but it’ll be a rhyme that’s hard to recognize at first. There will be an extra dump somewhere, things will be reversed, or postponed. There is also the fact that we are dealing with much more money than before and so it’s much harder to move markets. That doesn’t mean there aren’t whales or groups of whales who could do it.

There’s the fact that the new supply of bitcoin will eventually become so insignificant compared to the demand, and at this point, there isn’t much reason for bitcoin to follow the four year cycle. This is something I don’t see enough people talking about.

In the end, the price is set by one thing and one thing, the price people thinks it is worth. How many buyers, how many sellers and what price they are buying or selling at. That’s it. That’s all.

So could it go to $1 million? Why not? All you need is for people to see it as a viable competitor to the US dollar, and some FOMO based around that. 500k would place it above gold in terms of market cap, this seems more likely to me although it FEELS a bit early. Not 4 years early, but early.

I personally don’t think we are going to have the same blow off top like last time or a bear market like last time. I think there will be some kind of a fake out or a slower more sustainable bull market that has no end in sight as countries and billionaires continue to stack.

We will have to see.

There will always be pumps and corrections though, and I do think one is near. Whether it happens before the end of the year or this time next year, I can’t say.

I’m holding but I’m getting a little tempted to sell some crypto simply because after this past years 5x, it makes up for over 95% of everything I own and that freaks me out. It’s not that I don’t trust the asset, there are just too many points of failure when it comes to storing BTC, and I’d literally have nothing if I lost my crypto. That’s a lot more vulnerability than I’m comfortable with.

The only thing I want to remind people is that no matter how good our predictions are, they are never perfect. This time could see FOMO exponential to last time, or the next leg of the bull market could be postponed by unprecedented and unforeseen FUD. Remember how quickly sentiment changes. Stay safe, be ready for anything, and get excited.

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