So I use four different methods to project the price forward a set variable number of years. It uses compound annual growth rate, exponential regression (with an adjustable value for weighing recent data more heavily), something I call a temperature chart (which is a log trend chart with 7 different levels going from Glacial to Cooking), and lastly a Monte Carlo simulator with some options. So here are the results when averaging the methods mid-year 2025 - 2030.
snip
Feedback on the methods used and the results it has produced is appreciated. I am still looking to improve upon this.
You can try it
here.
The predictions seem to be too favorable if you ask me, now as a bitcoin holder I would love for those predictions to be true, but we must remember that as bitcoin gets more expensive the more difficult it is for its price to go up, since unless there is a massive crisis on confidence about the fiat system currently in place, there is almost no way that bitcoin is going to reach the highest prediction on your model which is of 15.5 million dollars.
Thanks for the feedback. Well, I wouldn't be surprised if Bitcoin some day took the place of the USD and became the world reserve currency. At that point though, the model would probably still predict the prices to rise at the same speed - which I don't think would be very likely. But then, if the price slacks off for a year or two, the model should take the new growth trend into consideration. The less data the model has and the further out the prices are projected - the less accurate they are.
And by the way, the Great, OK, and Awful are different calculated potential outcomes, it doesn't mean that all 3 are likely to happen the same year. Just to clarify that as I didn't earlier. And the OK projection is more likely than than the other two.
Uhm, isn'tt he great levels a bit too optimistic? Not to mention that it ignores the fact that Bitcoin growth for every year drastically decreases in terms of percentage. E.g, a 1000%+ increase would've been viable back in the past, but now? You'd be lucky to see 100%. And I reckon it's only going to continuously decrease for the later years. I honestly don't think we'd be going above 150k-200k even by the end of 2030. Wouldn't be surprised if we're actually going through the same cycle (20k - 70k) for 2027-2028 time.
Yeah, they might be too optimistic, I will do some thinking. In 2027, 2028 these charts show it's very unlikely we're not at at least somewhere around $200k - $300k. I don't see Bitcoin breaking the trend that hard and stay stale for so long. If we do see 20k or even 70k in 27 or 28 I think that would be a massive opportunity.
I am not sure if I should introduce the volatility falling off over time. Mainly because this projection model is not only for Bitcoin, but something that can be used on all assets. Assets with more historical data like, for instance, Gold and Nasdaq100, don't show volatility falling off over time when going back about 30 years even. Bitcoin is in a special position though as it was just invented a short while ago.
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