1 Cryptocurrency to Buy Before It Rises Up to 84,380% According to Michael Saylor

Michael Saylor is the executive chairman at MicroStrategy (MSTR -0.11%)a company specialized in business intelligence software. However, MicroStrategy is better known as the first public company to adopt it Bitcoin (BTC 1.13%) as its main treasury reserve asset and recently renamed itself “Bitcoin Development Company”.

MicroStrategy held 226,500 BTC as of July 31, worth over $13 billion. So buying shares of MicroStrategy stock is equivalent to buying Bitcoin. The company has a market cap of $25 billion, and a substantial portion of that value is derived from its Bitcoin holdings.

Saylor recently delivered a keynote address at a Bitcoin conference in Nashville, Tennessee, during which he shared his 20-year perspective:

“What do I think is going to happen? Well, I have a bear case and a bull case. But what I think will happen is that the 55% (compound annual growth rate in Bitcoin) goes to 50%, 45%, 35%, 30%, 25%, 20%. It is between 50% and 20%. S&P 500 index. And at this rate, Bitcoin will have $13 million per coin in the year 2045. $13 million! It could be a $3 million bear case and a $49 million bull case.”

Bitcoin is currently trading at $58,000 per coin. So Saylor expects the cryptocurrency to return between 5,170% and 84,380% by 2045. Here’s what investors should know.

Spot Bitcoin ETFs could unlock substantial demand for Bitcoin

The investment thesis for Bitcoin is simple supply and demand. The supply of Bitcoin is limited to 21 million coins, so demand is the most important variable. In other words, Bitcoin will become more and more valuable, provided demand continues to grow over time. And Michael Saylor believes the recent approval of spot Bitcoin ETFs will boost demand by bringing more investors into the market.

“It’s been 10 years since the request was repressed. People have been waiting for these ETFs, and finally, mainstream investors can access Bitcoin,” Saylor told CNBC in February. “The asset has found its footing, and now people are starting to realize that there is 10 times more demand for Bitcoin coming through these ETFs than there is supply coming from the natural sellers, which are the miners.”

Traditionally, investors had to go through cryptocurrency exchanges to gain exposure to Bitcoin and generally incurred high fees for each transaction. But Bitcoin spot ETFs could unlock substantial demand from retail and institutional investors by reducing that friction. Investors no longer need a separate account with a cryptocurrency exchange, but rather can add Bitcoin to their existing brokerage accounts.

In addition, investors no longer have to pay exorbitant transaction fees, as many Bitcoin ETFs detect are less expensive. For example, the iShares Bitcoin Trust has an expense ratio of 0.25%, meaning annual fees for a $10,000 portfolio will total $25. But Coinbase charges 0.4% to 0.6% per transaction for orders under $10,000. In this scenario, investors are hit with higher fees twice: once when they buy and again when they sell.

Spot Bitcoin ETFs have broken all kinds of records since their approval in January. The iShares Bitcoin Trust and Wise Origin Bitcoin Trust accumulated more assets in its first 50 trading days than any ETF in history, according to Bloomberg Intelligence’s Eric Balchunas. In addition, the iShares Bitcoin Trust reached $10 billion in assets faster than any ETF in history, according to The Wall Street Journal.

History says Bitcoin will be worth more in four years

Bitcoin halving events refer to the 50% reduction in block grants, which occurs approximately once every four years. To elaborate, miners are rewarded with newly minted Bitcoin (called block grants) when they solve the cryptographic puzzle required to validate a group of transactions (called a block). But the payment is halved every time 210,000 blocks are added to the blockchain, which takes about four years.

The most recent halving event took place in April 2024, when the block grant was reduced from 6.25 BTC to 3.125 BTC. Halving events is important for two reasons. Primarily, they are the mechanism by which Bitcoin’s 21 million supply limit is enforced. Second, they reduce selling pressure simply because miners are minting less Bitcoin, so they have less Bitcoin to sell.

Importantly, Bitcoin has always increased in value between one halving event and the next, as detailed in the chart below.

Data source: Morgan Stanley, YCharts.

In short, history says that Bitcoin will be worth more than $63,462 when the 2028 halving event occurs. In the past, the return between halving events has declined with each subsequent event, but access to spot Bitcoin ETFs could break this pattern, simply because that variable has been absent from previous halving events. In other words, Bitcoin could theoretically return more than 619% by the 2028 halving event.

Saylor’s targets range from wildly optimistic to absurd, but investors should still consider buying Bitcoin

Time for a reality check. Saylor’s $3 million price target is wildly optimistic, and the $49 million price target seems downright absurd. But I would have said the same thing about a $58,000 price target in 2010 (when Bitcoin was trading at less than $1). Lo and behold, almost 15 years later, Bitcoin is worth $58,000. So I would be wrong.

That doesn’t mean Bitcoin is headed for $3 million (or $49 million). But Bitcoin clearly has the ability to create substantial wealth, so patient investors who are comfortable with volatility should consider holding a small position. Even if Bitcoin only returns 100% in the coming years, this could be a significant change.

However, comfort with volatility is essential. Bitcoin has fallen by more than 50% on several occasions, and similar declines are likely in the future. Additionally, smaller pulls are common. For example, the cryptocurrency is currently trading 20% ​​below its all-time high. Anyone not bothered by this information should consider buying a small position in Bitcoin today, either directly or through a spot Bitcoin ETF.