Another way of looking at the halving, market cap and coin inflation rates

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tl;dr If market cap growth is to increase we are going to see a nice jump due to halving. On top of that the rate of this growth can also increase as it did after the last halving. Even with $41,000 coins it would take 32 years to reach MSFT's market cap on 30 Dec 1999.

12/31/2015 price $430
9/18/14 price $430

day diff is 469
block diff is 67,536
coin diff is 1,688,400

12/31/2015 coins 15,028,500
9/18/14 coins 13,340,100

market cap now $6,462,255,000
market cap then $5,736,243,000
increase is $726,012,000
increase is 12.66%

430*1.1266=484.438

$1,548,000 per day gained at $420*3600

2753 2553 days since genesis until now
growth at above rate would imply $4,261,644,000 $3,952,044,000
but actually grew $2,500,000 per day over lifetime of btc until now
*had 50btc/10m for ~1/2time

2084 days until 9/18/14 from genesis
grew by $2,752,000 a day

at current $1,548,000 then we have $309,600,000 before halving
2nd halving implied price $6,771,855,000
that is if 15,750,000 coins = $430

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28 nov 2012 halving was 1425 days since genesis
10,500,000 coins
~$115,000,000
grew $81,000 per day until 1st halving

$6,656,855,000 between first halving and implied second halving
1328 days
$5,012,692 per day

62x daily growth from 1st to 2nd

But current coins per day are worth $1,548,000 per day, .3x the average growth rate between halving 1 and 2
Or .62x the overall growth rate throughout the life of the system

and 81,000/7200=$11.25 for first phase

?= 430/.3 - 430/.62 = $693-$1433
? After 2nd halving then per day issued is $1,247,400 per day - $2,579,400

If 3rd era is 15x from 2nd era (.25 previous jump) then $41,000 coins to get to ~75m daily increase from 1800 coins

75m daily increase would be 27.375b per year

MSFT cap was 879b on 30 Dec 1999. At above rate of growth it would still take 31.9 years (2048) for us to reach that total. (n.b. not accounting future halvings)

Edit: Corrected two errors, needs rechecking

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[RyNinDaCleM]

Interesting thanks!

I have some comments but need to prepare my post. Will edit when I have it ready

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Cool! Looking forward to your comments. 

[oda.krell]

Thanks, OP. Not sure I see the point of the MSFT comparison (or I maybe don't fully follow it), but the alternative way of looking at growth is pretty interesting.

[keystroke]

Glad you guys find this interesting.

I added the MSFT bit there as a sort of sanity test because I have no reference as to what 879b looks like. Of course that was bubble time for Microsoft. As we know bitcoin "market cap" is not really market cap.

Thoughts on additional analysis which could be done with this perspective? I think everyone is naturally concerned about their own hoard so we look at the price of each coin alone. The above approach is an attempt at a more circuitous route which takes into account the overall value of the network during this highly inflationary time. The network is worth $.75m more now than last time bitcoin was at this price yet everyone feels as though we finally are back to late 2014 -- in a sense this is correct but I think it is misleading. The understanding people have on what it means for a coin to be priced at $X will naturally influence the market but I would wager that those beliefs cause effects of a higher order than these more fundamental network constraints.

[8up]

Glad you guys find this interesting.

I added the MSFT bit there as a sort of sanity test because I have no reference as to what 879b looks like. Of course that was bubble time for Microsoft. As we know bitcoin "market cap" is not really market cap.

Thoughts on additional analysis which could be done with this perspective? I think everyone is naturally concerned about their own hoard so we look at the price of each coin alone. The above approach is an attempt at a more circuitous route which takes into account the overall value of the network during this highly inflationary time. The network is worth $.75m more now than last time bitcoin was at this price yet everyone feels as though we finally are back to late 2014 -- in a sense this is correct but I think it is misleading. The understanding people have on what it means for a coin to be priced at $X will naturally influence the market but I would wager that those beliefs cause effects of a higher order than these more fundamental network constraints.

I like your thinking. Also market cap is an "illusionary number". It's much better to understand the history of bitcoin.

The april high of 2013 ($266 / 2.6b) almost equals the 2.4b of our recent low in january 2015 ($152).

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The april high of 2013 ($266 / 2.6b) almost equals the 2.4b of our recent low in january 2015 ($152).

Very interesting point! And to get back to the ATH in "market cap" would now only require a price of $925, which is 20% less than the ATH price per bitcoin. (I am using blockchain.info numbers here for simplicity.) This number will drop to $882 by the time of the halving, which is coincidentally 2x the current price. Hmm.