The market capitalisation of Bitcoin could reach as high as $200 trillion in the next decade, according to veteran Bitcoiner and cryptographer Adam Back.
The founder and CEO of Bitcoin infrastructure company Blockstream took to Twitter to posit potential trajectories for the top cryptocurrency, saying “early this year I was curious of the claim ‘bitcoin 2x’s per year on average'”.
He went on to note that the “checks [out],” and that BTC in fact has risen by 2.036 times per year on average between January 2013 and December 2022.
If this trend continues, the price for one bitcoin will reach $19 million by the end of the next two halving cycles. Commensurately, the asset’s total market capitalisation would reach a jaw-dropping $200 trillion, Back said.
Early this year I was curious of the claim “bitcoin 2x’s per year on average”. it checks: the decade Jan 2013 – dec 2022 #bitcoin went up 2.036x/year (1200x in a decade). if that continues we’ll cross $10mil/BTC and $200 tril market cap by end of next 2 halvenings, about 9 years. pic.twitter.com/mqmO2SRdAv
— Adam Back (@adam3us) February 12, 2023
Bitcoin halvings occur about every four years, with bitcoin rewards slashing in half after every epoch. Historically, the halvings have been catalysts for bull market cycles, which in turn fuel flows in the broader crypto economy.
At the time of writing, Bitcoin’s market cap stands at $417.5 billion, or $0.42 trillion. If Adam’s speculative prediction proves to be correct, then the opportunity for newer market participants today is astounding.
Hal Finney’s original prediction
In the Twitter Thread, Adam highlighted that this prediction is not new. In fact, it was made by an early Bitcoin user by the name of Hal Finney way back in 2009 when BTC was worthless.
According to Finney, who passed away in 2014 due to ALS complications, such a market cap could be reached if Bitcoin “becomes the dominant payment system in use throughout the world. Then the total value of the currency should be equal to the total value of all the wealth in the world.”
$200 trillion is a @halfin 2009 #bitcoin market cap prediction number. it’s a LOT, displaces a significant part of the store of value premiums in bonds, real estate monetary premium, gold, 60:40 stock portfolios, etc. some think adoption will slow, derivatives reduce volatility. pic.twitter.com/xrw1EGDzhv
— Adam Back (@adam3us) February 12, 2023
Back went on to say that he does not expect adoption to slowdown, nor does he expect volatility to decrease throughout this process. He even said that adoption might lead to “hyperbitcoinization spurts,” where “rapid viral adoption nukes a weak currency in a hyper-inflationary frenzy.”
Adam is referring to a global race to the bottom for fiat currency purchasing power, which cannot compete with Bitcoin on a long-time horizon.
“People get pragmatic, adapt fast if they see fiat melting, a rush of others protecting savings via bitcoin,” the Blockstream founder explained, while simultaneously adding that Bitcoin users “won’t have much incentive to sell in size”.
As less bitcoin is available due to increasing an illiquid supply on the open market, newcomers and later adopters would effectively have to “pry it out” of existing users’ cold wallets, Back wrote.
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