Where will Bitcoin be in 10 years?

In the last 10 years, Bitcoinhis (BTC 0.15%) the price skyrocketed from $478 to $58,400 today, turning into a monster 122x gain. In fact, this top cryptocurrency has outperformed every other asset class in eight out of 11 full calendar years since 2013. That’s a phenomenal track record.

Investors look in the rearview mirror to guide their decisions about what the future may hold. That said, where will Bitcoin be in 10 years?

Bitcoin’s past

Bitcoin has grown in earnest over the past decade. It started as a hobby for cypherpunks interested in this so-called “cool internet money”. Back then, it was difficult to even buy and store Bitcoin, and wild price swings make today’s volatility seem like a walk in the park.

But the evolution over the years has been noteworthy. Bitcoin has thrived thanks to an expanding financial services infrastructure that has fueled its adoption, with things like digital wallets and innovative hardware, brokerage, and payment methodologies. Furthermore, regulators have not prevented the expansion of the crypto industry.

About a year ago, an estimated 82 million people owned Bitcoin. It is legal tender in El Salvador. And the big corporations own it Audits.

The Future of Bitcoin

The number of people who would argue that Bitcoin is no longer a legitimate financial asset is certainly shrinking. This is especially true now that it exists Bitcoin exchange-traded funds (ETFs). on the market sponsored by some of the most reputable asset managers. It has never been easier to gain crypto price exposure for your own portfolio.

Bitcoin is also viewed more favorably politically. Donald Trump was the keynote speaker at the Bitcoin Conference in Nashville in July. He drew attention for saying he wanted the US to have a strategic reserve of the digital asset. The fact that a former president and current presidential candidate in the world’s largest economy is voicing his support for Bitcoin shows just how strong supporters of the digital asset have become.

It is not hard to believe that there will be a growing interest in Bitcoin. The fixed supply limit of the crypto is an extremely compelling feature. After all, when the demand for a rare asset increases, so does the price. This is what has happened historically.

And Bitcoin stands out when viewed alongside the huge levels of public debt around the world. Here in the US, for example, the government ran a $1.7 trillion fiscal deficit last year, which inevitably leads to increased debt, a larger money supply, and a deflation of the value of the currency. As more people learn simply why Bitcoin is superior to this unfavorable setup, they may want to own it.

Ultimate Bitcoin Rating

Investing in stocks of companies that sell products and services and generate revenue and profits is easier to understand. This is because there are valuation techniques that investors can use when trying to figure out what a stock might be worth in the future.

With Bitcoin, it’s not as simple. Crypto does not produce sales or free cash flow. Consequently, it is definitely more of an art to attempt any kind of assessment exercise.

Gold, which is a popular store of value, is often viewed side by side with Bitcoin. The precious metal has been perceived as a good haven for a very long time. However, this one shortages in certain areas. Bitcoin is easier to store and transport, more verifiable and rarer.

Therefore, perhaps an accurate price target for Bitcoin should be gold’s current market cap of $17 trillion. Based on Bitcoin’s current market cap of $1.2 trillion, there is a 1,300% upside. Comparing the price and properties of Bitcoin to gold makes a lot of sense, but how long it will take to reach this market cap is anyone’s guess.

Perhaps a more reasonable perspective is to simply assume that Bitcoin’s yield will begin to decline. If it grows at an annualized rate of 15%, its price should quadruple between now and 2034. That seems totally realistic to me, and maybe even a little conservative.