$500,000 per Bitcoin, baby. The math behind it.

[inBitweTrust]

The power consumption over the next 50 years is harder to predict than the price.  There are many factors simplified above that could change.

You are correct for acknowledging the many known unknowns and potential unknown unknowns, thus I reject this one comment:

So, in order to keep our power consumption under about 2% of world wide power production, we cannot/do not want the price to get to $500,000 before era 6, which is about 2033 or so.

There definitely are physical restrictions with todays technology on the market cap of bitcoin but all of that can change overnight....
Printable solar cells with ASIC's? ASIC space heaters?

[vpitcher07]

I certainly hope you're right! However I feel like the way you're jumping to this conclusion of 500,000 a btc is a bit too simplistic. There are many other factors involved in price besides worldwide adoption. Regulation, mining, human nature (which is unpredictable) and possible problems involved with bitcoin that have yet to be discovered. It's not totally unreasonable to see 500,000 a coin at some point but I don't see it anytime in the near future. Maybe 30 years from now but we also have to take into effect the rate of inflation. What will $1 buy us in 30 years? I love the bullish outlook on bitcoin but I think you're just a bit too bullish. Just my 2 bits though. I hope I'm very very wrong

[iluvpie60]

Bitcoin is the 3rd revolution I'm living through

1st revolution was Personal Computer's which are now tablets and smartphones to many (1980's-2000's)
2nd revolution was The Net the age of instant free info (1990's-2000's)
3rd revolution was Digital Cryptocurrency (2010's-)

I honestly believe most here will be telling our grand kids about a thing we used to have called money that evil governments printed at will to fuel stupid wars.

They will ask, "gramps, how did you become so rich?"

You will say, "Because I SAW THE REVOLUTION COMING and put lots of worthless government notes into tech notes you call BITCOIN."

After you've been front lines in a couple of revolutions you start to see them coming.

BITCOIN is like the Internet and the personal computer. It is the NEXT revolution.

Bitcoin had four ten-fold growth bubbles:

• $0.05 per bitcoin. The start.
• $0.50 per bitcoin. First tenfold bubble
• $5.00 per bitcoin. Next tenfold bubble
• $50.00 per bitcoin. Next tenfold bubble
• $500.00 per bitcoin. Our current bubble

Next bubbles:

• $5,000 per bitcoin.
• $50,000 per bitcoin.
• $500,000 per bitcoin.

For $5,000 to happen you need ONLY 0.1% acceptance of world population for Bitcoin. We are at 0.01% now.

$50,000 is just 1% of Gross World Product by Bitcoin produces $50,000 bubble.

$500,000 per Bitcoin is just 10% Gross World Product by Bitcoin.

Can Bitcoin hit 10% growth of population?

Credit cards did and they reject 90% of the world.

Bitcoin rejects no one.

So Bitcoin will go in trade where Visa/Mastercard refuse to go.

So way over 10% of Gross World Product can eventually be Bitcoin

10% of Gross World Product is $8.5 trillion

Divide 12M coins into $8.5 trillion

$500,000 Bitcoin baby.



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The original poster of this was not me. Full credit goes to this guy "domainbrokers". I liked his post so much that I wanted to share it.

The problem with most peoples "math" on this subject is that they assume to many things as a constant and that these things all "line up" with each other and "will" happen.

It is all fine and dandy to claim if "X" happens then "Y" will follow and the price will be "Z". If the world actually worked like that all the time there would be a lot more people who are rich, but there isn't that many rich people. The other problem is the liquidity of it all. BTC won't be spent once it starts going higher and higher. If it really ever reaches 10K you will see hoarding like you wouldn't believe, the people who got in early will obviously get out of it at that point for the most part, you would legitimately be crazy not to. If you had 100 bitcoins and the price is 10,000 USD each that is 1,000,000 USD man. That is more than enough to put into stocks/retirement account and do whatever the hell you want for the rest of your life.

The other "issue" is that every single payment processor will go broke if this happens. You have to think about it like this. They have to now buy bitcoins for 500k for a full bitcoin in your example, what happens if bitcoin goes down by 80,000 USD in a week? they are going to have so much f-ing risk its not gonna be funny.

You need to think about this in more ways than what some theoretical math comes out.


The other problem people fall into is saying that BTC must be worth X because of how much Y there is in total USD. No, it doesn't have to be like that and does not directly work that way. Most of the volume is just people trading back and forth on exchanges and not buying real items. GDP is not trading back and forth on exchanges, it is Gross Domestic Product, which DOES NOT have stock trading factored into it. It is Revenue - cost dude. Equating GDP to stocks is wrong. Equating stocks to BTC is right. Therefore equating GDP to BTC is wrong.

#themoreyouknow

[colinistheman]

Yes, it will take a while to reach $50,000. Many years.

But it will hit $5000 within the next 6 months.

$5,000 in the next 6 months!? LOL. What planet are you living on?

It will peak at that price and then correct itself. I'm living on Earth. What planet are you living on?

[colinistheman]

I certainly hope you're right! However I feel like the way you're jumping to this conclusion of 500,000 a btc is a bit too simplistic. There are many other factors involved in price besides worldwide adoption. Regulation, mining, human nature (which is unpredictable) and possible problems involved with bitcoin that have yet to be discovered. It's not totally unreasonable to see 500,000 a coin at some point but I don't see it anytime in the near future. Maybe 30 years from now but we also have to take into effect the rate of inflation. What will $1 buy us in 30 years? I love the bullish outlook on bitcoin but I think you're just a bit too bullish. Just my 2 bits though. I hope I'm very very wrong

Yes it will take some time. I don't think it will happen overnight. I think 20-30 years is about right to see something like half a million dollars per btc.

[Leina]

A cheap lottery ticket for living next the beach dream.

Bought 1 bitcoin. Hopefully will have 5 before year end.

[colinistheman]

A cheap lottery ticket for living next the beach dream.

Bought 1 bitcoin. Hopefully will have 5 before year end.

Good job. You won't regret it.

I got my own mother to buy 15 bitcoins over the past year. She is going to be sitting pretty in 5 years.

(and don't worry, I secured them for her)

[Ron~Popeil]

It is fun to speculate on this stuff. I think the next meteoric rise is still a bit off in the future. The longer it takes the more we can all accumulate.  

[leex1528]

I mean you can "math" all you want.

But realistically

You have no idea what will happen just as much as we have no idea:)

[inBitweTrust]

You have no idea what will happen just as much as we have no idea:)

Outside of a black swan event we are fairly sure a bubble will occur in 2015 due to the block halving in 2016. The markets will anticipate the demand in advance and price accordingly. Bitcoin bubbles typically have been 7-10 times gains followed by a crash. So I predict at minimum 6k bubble that will crash to 3 k support by mid to late 2015 as the most conservative estimate.

If demand is strong there will should be another bubble after the block halving in 2016 sending bitcoin from an estimate of 3k to 20-30k followed by a crash to around 10-15k support.

No one should be taking profits before 2016 if they understand the principles of supply and demand. Anyone who believes in Bitcoin longterm should be investing 100% of their disposable income for the next year into bitcoin.

[leex1528]

Outside of a black swan event we are fairly sure a bubble will occur in 2015 due to the block halving in 2016. Bubbles typically have been 7-10 times gains followed by a crash. So I predict at minimum 6k bubble that crashed to 3 k support by mid 2015 as the most conservative estimate.

No one should be taking profits before 2016 if they understand the principles of supply and demand.

This is true...however we have no idea what could happen before then.  I mean, Something amazing could come along and completely destroy bitcoin to be worth nothing.

More things could crash like gox and make it so unstable that it just plummets...

[inBitweTrust]

This is true...however we have no idea what could happen before then.  I mean, Something amazing could come along and completely destroy bitcoin to be worth nothing.

More things could crash like gox and make it so unstable that it just plummets...

Unlikely, because of first movers advantage, the ability of Bitcoin to incorporate new features if needed, the network effect, and the reality that if Bitcoin fails it will question the credibility of any other decentralized crypto-currency. Bitcoin is too big to fail in the best possible way so we should jump in and make sure it stays pure and used as originally intended by Satoshi.

but.... they call it a "black swan event" for a reason.....

My philosophy is I don't care about the potential risks of a black swan event because my motivations are far beyond investment and mainly ethical and philosophical in nature. This may initially seem to be unwise and irrational when it comes to investing but is also precisely the reason bitcoin will succeed: Their are many of us that believe in it and will not allow it to fail.

[Beliathon]

Visual Aid:

[Puberty]

A cheap lottery ticket for living next the beach dream.

Bought 1 bitcoin. Hopefully will have 5 before year end.

If only I had spent the money that I used to buy lottery tickets back in 2011 on Bitcoin instead. Back then, Bitcoin was the real lottery ticket. You could hardly buy anything with it and the chances of it going mainstream were slim. Even though the odds were stacked against you, the potential rewards would have been enormous. Who knew that Bitcoin would be where it is today.

[hodap]

A cheap lottery ticket for living next the beach dream.

Bought 1 bitcoin. Hopefully will have 5 before year end.

If only I had spent the money that I used to buy lottery tickets back in 2011 on Bitcoin instead. Back then, Bitcoin was the real lottery ticket. You could hardly buy anything with it and the chances of it going mainstream were slim. Even though the odds were stacked against you, the potential rewards would have been enormous. Who knew that Bitcoin would be where it is today.

Yes. By the power of induction, 5-10M per coin is within reach in 2-5 years.

Don't forget the cost of mining will go up exponentially.

[Anders]

My guess is that Bitcoin may reach $5,000 but not much more than that. And Bitcoin may go down to $500 but not much lower than that. <-- wild guesses 

[colinistheman]

My guess is that Bitcoin may reach $5,000 but not much more than that. And Bitcoin may go down to $500 but not much lower than that. <-- wild guesses  

I think that is considerably less than we will be seeing. If you believe Bitcoin is going to continue on, then it will have to get much higher to accomodate all the people that will be getting in. We have like 0.01% market adoption if that.

C'mon, think big and look at the big picture!

[Beliathon]

Who knew that Bitcoin would be where it is today.

People smarter than you, mostly.  

The lottery is a tax for people who are bad at math and pattern recognition.

Bitcoin is a gift to people with exceptional pattern recognition skills. If only you had met me in 2011, I would've explained this reality to you.

[Lauda]

Yes, it will take a while to reach $50,000. Many years.

But it will hit $5000 within the next 6 months.

A sustained $5000/BTC price would drive mining to attempt to consume about 0.3% of world wide power production.  That is a lot, but at least is it possible.

It might not be $5000, $2500 is more than enough and that's like 0.15% is that an reasonable amount of power?

[kingama]

A $500k bitcoin means being a billionaire takes only 2000 btc and a millionaire.?.. lol