Hal Finney already knew BTC had the potential to be $10,000,000 a coin in 2009

[BillyBobZorton]

I was reading the cryptography mailing list looking for early bitcoin posts and Hal Finney did some basic calculations and already realized that bitcoin had the potential to be worth $10,000,000 per coin back in 2009. Imagine being this woke that early in the game:



Very impressive insight. And not only that, but he actually never panic sold. Now his family will be very well off for all generations. Meanwhile a lot of people weren't able to see past USD price movement and didn't look at the project for what it is, this made most people sold during the $30, $300 and $1200 bubble. The people that know what bitcoin is haven't sold a single sat since the beginning.

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[alyssa85]

I was reading the cryptography mailing list looking for early bitcoin posts and Hal Finney did some basic calculations and already realized that bitcoin had the potential to be worth $10,000,000 per coin back in 2009. Imagine being this woke that early in the game:



Very impressive insight. And not only that, but he actually never panic sold. Now his family will be very well off for all generations. Meanwhile a lot of people weren't able to see past USD price movement and didn't look at the project for what it is, this made most people sold during the $30, $300 and $1200 bubble. The people that know what bitcoin is haven't sold a single sat since the beginning.

You need to remember he was making this calculation in the belief that bitcoin would be the only cryptocurrency. But by 2013 there were already 100 cryptocurrencies and now there are over 2000.

Bitcoin won't get to $10 million per coins, because users will switch to other coins.

[BillyBobZorton]

I was reading the cryptography mailing list looking for early bitcoin posts and Hal Finney did some basic calculations and already realized that bitcoin had the potential to be worth $10,000,000 per coin back in 2009. Imagine being this woke that early in the game:



Very impressive insight. And not only that, but he actually never panic sold. Now his family will be very well off for all generations. Meanwhile a lot of people weren't able to see past USD price movement and didn't look at the project for what it is, this made most people sold during the $30, $300 and $1200 bubble. The people that know what bitcoin is haven't sold a single sat since the beginning.

You need to remember he was making this calculation in the belief that bitcoin would be the only cryptocurrency. But by 2013 there were already 100 cryptocurrencies and now there are over 2000.

Bitcoin won't get to $10 million per coins, because users will switch to other coins.

The number of cryptocurrencies is irrelevant. In the long term, most money will be on bitcoin, because it will be clear for the average investor that your money is at too much of senseless risk in any other crypto asset but bitcoin.

In a long enough timeframe with an infinite amount of altcoins, 80% of the money will be on bitcoin due Pareto distributions of capital. Anything worthwhile brought up in an altcoin will be implemented in bitcoin.

[shahzadafzal]

Well this was calculated purely on "if" bitcoin becomes the only payment system in the world, provided no other crypto currency exits.

Let's suppose today all other crypto currencies disappear and we have only Bitcoin, referring to coinmarketcap for market cap and btc circulating supply  

As of today if BTC is only crypto currency
Market Cap: $454,891,923,780
BTC Supply: 16,893,662 BTC
1BTC = $26926.78

Now this is when fiat is still in circulation.

Let say BTC replaces all USD supply
As of Jan 2018: $3.6479 trillion (m1 supply)
Even at this 1BTC = $215,879

Clearly that Hal Finney's calculation may be true in far far future few hundred years from now.

Please note its almost 100 years since "credit cards" idea was coined and still its not 100% dominated payment system in the world.

[Dart315]

Interesting!

I'm reading ''The Sovereign Individual: Mastering the Transition to the Information Age''. Two guys basically predicted Bitcoin and cryptocurrencies back in 1997(!)

[jmlona]

Except many would argue that bitcoin does not have the potential to be $10m per coin and we are 9 years down the line and much closer to that. The only way that bitcoin would ever reach such a level is if there is huge hyper inflation of USD with mass printing.

Well this was calculated purely on "if" bitcoin becomes the only payment system in the world, provided no other crypto currency exits.

Let's suppose today all other crypto currencies disappear and we have only Bitcoin, referring to coinmarketcap for market cap and btc circulating supply 

As of today if BTC is only crypto currency
Market Cap: $454,891,923,780
BTC Supply: 16,893,662 BTC
1BTC = $26926.78

Now this is when fiat is still in circulation.

Let say BTC replaces all USD supply
As of Jan 2018: $3.6479 trillion (m1 supply)
Even at this 1BTC = $215,879

Clearly that Hal Finney's calculation may be true in far far future few hundred years from now.

Please note its almost 100 years since "credit cards" idea was coined and still its not 100% dominated payment system in the world.

This point completely emphasizes that, there's not enough USD to go around for BTC to reach $10m per coin.

[Alone055]

He used "imagine" which means he wasn't doing any calculations for reaching that conclusion, but he said it as an imaginary thought that if Bitcoin is successful then the price of each Bitcoin can be equal to that in future. That doesn't mean that he already knew it would be successful. I'm sure many people would have said good words about Bitcoin even at the starting, but none of them were sure if this would really become the reality some day.

[jhenfelipe]

You need to remember he was making this calculation in the belief that bitcoin would be the only cryptocurrency. But by 2013 there were already 100 cryptocurrencies and now there are over 2000.

Well this was calculated purely on "if" bitcoin becomes the only payment system in the world, provided no other crypto currency exits.

The word "dominant" is different from "only". In the statement, he uses the word dominant, meaning even there are other payment system as long as Bitcoin is the one leading/prevailing it might have that value.

Back in the statement, Hal Finney didn't know but instead he thought that Bitcoin will be worth that much if it would be the dominant payment system (in terms of price, no one will be sure of imo). As to why he never sold his Bitcoins:

The next I heard of Bitcoin was late 2010, when I was surprised to find that it was not only still going, bitcoins actually had monetary value. I dusted off my old wallet, and was relieved to discover that my bitcoins were still there. As the price climbed up to real money, I transferred the coins into an offline wallet, where hopefully they'll be worth something to my heirs.

I snipped the quote, for the whole post Bitcoin and me (Hal Finney) ~

[odolvlobo]

Unfortunately, Hal had the same misconception that many people have, thinking that the total amount of money represents the total amount of wealth. That is not true. Money is not backed by anything, not even gold.

Here are some examples of how it is wrong:
If I find a gold nugget, there is no money anywhere that represents the value of that nugget.
If I build a house, there is no money anywhere that represents the value of that house.
If I buy a used car, then you might say that the value of that car is represented by the money that I paid, but then if the seller buys another car with that same money, which car is represented by that money?

In short, I don't think it is valid to equate the value of a currency (or even all currencies) to the total wealth of the world.

[buwaytress]

I don't think Finney was alone in being that optimistic - you've got to remember that for the early developers, they almost had no choice but to believe in their dream. Bitcoin wasn't something you could just do with some hope it would succeed, it's not the same as launching any coin today. Bitcoin was unheard of, it was crazy, it was hopeless. You'd had to have believed in it with everything you had.

P.S. Talk about holder!

The number of cryptocurrencies is irrelevant. In the long term, most money will be on bitcoin, because it will be clear for the average investor that your money is at too much of senseless risk in any other crypto asset but bitcoin.

In a long enough timeframe with an infinite amount of altcoins, 80% of the money will be on bitcoin due Pareto distributions of capital. Anything worthwhile brought up in an altcoin will be implemented in bitcoin.

I agree actually! It may very well be that there'll be well over a million cryptocurrencies one day soon. If anything, the proliferation of such can only make Bitcoin's stature grow, with every successful alt a nod of approval towards what Bitcoin set out to do.

[surfinonmyownwavebaby]

He used "imagine" which means he wasn't doing any calculations for reaching that conclusion, but he said it as an imaginary thought that if Bitcoin is successful then the price of each Bitcoin can be equal to that in future. That doesn't mean that he already knew it would be successful. I'm sure many people would have said good words about Bitcoin even at the starting, but none of them were sure if this would really become the reality some day.

He clearly states that even if it works out one in a hundred million times, that this experiment might be worth it. Of course nobody knew the trajectory that Bitcoin would undertake but I think we can all agree it has come further than it was intended to, even by the creators themselves.

[IndzheborgC]

Too many factors affect the price of bitcoins, so it is impossible to extrapolate with a certain degree of certainty. And the more popular the bitkoyn the more competitors will appear.

[boy130]

His prediction is unbelievably optimistic to reach a level of $10,000,000 per coin. That would assume that Bitcoin manages to capture the entire global market with absolutely no competition. I have never heard of any industry where there is total monopoly like that, even currencies have competition in the form of other currencies.

It will be difficult for Bitcoin to capture even 100th of that valuation, certainly much more plausible than $10m however.

[Kavallo]

You have missed to notice that Hal Finney is starting his argument with the words "as an amusing thought experiment".
For those of you who are functional analphabets I should explain that this means that he was not serious in his argument, in other words he was NOT predicting that Bitcoin would raise until 10,000,000$. He was just doing an amusing thought experiment. I understand that if you have never done any amusing thought experiments lacking any thoughts you are probably quite impaired in understanding what this actually is all about.

[OuterTech]

As I can see there are a lot of people believe that Bitcoin price can reach to 1m$ or maybe even 10m$ but the problem is when it'll be? LOL. I'm also very attracted in Bitcoin and I believe in Bitcoin so much but I don't think Bitcoin can reach to 10m$ although how long it'll take. I'm afraid that when Bitcoin price rise to thousands or millions dollars, people will turn into other cryptocurrencies to trade cause it's too high to own 1 or 2 BTC )

[pinkflower]

I think that was all theoretical from Hal Finney's part? Was he an economist? No, he was a computer scientist who was pulling numbers from the air because he assumed that just because BTC is a deflationary currency, it would have no direction to go but up.

But that might not really the case. Look at gold and other precious metals.