How High Can Bitcoin Go?
It hasn’t been an easy road for Bitcoin traders. Those who made their long way over the turbulent decade are now caught in a serious dilemma: what’s next?
The media is selling diametrically opposed speculations. On one side, you run across screaming headlines about Bitcoin reaching a six-figure price in the near future. On the other side, skeptics keep warning us that Bitcoin will burst like a bubble in no time. Who should we trust?
Bitcoin alone led the digital revolution, so we can’t rely on any prior financial behaviour pattern. Hence, we’ll start this article with a short history of Bitcoin’s price. Without exaggeration, we’ll also discuss the three possible best and worst-case scenarios, based on relevant sources and indicators.
Let’s move along before Bitcoin’s price surprises us again.
A Brief History of the Price of Bitcoin
In January 2009, when the first Bitcoin network was created, Bitcoin didn’t have an exchange rate. Ten months later, 1USD was equal to 1.309 BTC, equivalent to the price of electricity you needed to mine one Bitcoin.
In 2010, the initial Bitcoin exchange was created and it was the first time hackers found a vulnerable point in the blockchain. They managed to generate 184 billion Bitcoin, which resulted in a considerable price devaluation. Bitcoin price reached 1USD for the first time in 2011. It was the year when Bitcoin gained certain attention on the black market due to its decentralized nature.
The following year, Bitcoin started getting noticed worldwide as an alternative currency for buying certain goods and services and, by the end of 2013, the price of Bitcoin rose to 1,000 USD. In 2014, the leading economic powers like the USA and China issued the first official regulations on Bitcoin use and taxation, which made Bitcoin eligible for institutional investments.
However, 2014 would also be remembered for the series of hacker attacks of Mt. Gox, the leading exchange platform at that time. Due to the irreparable loss of millions of dollars, Mt. Gox was closed down, and the price of Bitcoin expectedly dropped to 200 USD.
The first price hit occurred in 2017 when one Bitcoin equaled the amount of 20,000 USD. However, it seemed that the world was running a negative campaign against the blockchain industry at this point. Bitcoin was banned by many countries and deliberately avoided by the leading social media. Consequently, the Bitcoin price collapsed to 3,000 USD.
In 2019, the status of cryptocurrency was regulated gradually, and the price got stabilized to a certain extent. However, it wasn’t until 2020 that Bitcoin took a giant leap forward and surpassed even the most optimistic expectations. The regular market reached a dead end due to the outburst of the pandemic and all proactive investors focused their attention on digital assets.
The price hasn’t stopped going up in 2021. At the moment of writing, you can buy 1 BTC for an amazing $60k USD. So, how high can Bitcoin go? Can you imagine what a similar article will have to add up under the “brief history” heading in 2040?
Three Possible Scenarios for Bitcoin’s Future
Bitcoin Becomes a Reserve Currency
As utopic as it may sound, according to some crypto-enthusiasts, Bitcoin is on its way to replace the US dollar as a main unit of exchange in the future. It would mean a total triumph of Bitcoin over fiat currencies, high demand, and price stability.
From a technical perspective, Bitcoin can’t become a primary global currency soon, mainly because it is not a medium of exchange. Besides, transactions tend to go more slowly as the number of transaction volumes rises. For comparison, Bitcoin’s processing capacity is 4.6 transactions per second while VISA processes up to 1,700 for the same time rate.
Some less daring observers claim that it is impractical to expect that Bitcoin will replace the dollar as a global currency, but still think it’s quite likely to become a dominant exchange currency worldwide. In other words, you will be able to go to McDonald’s and pay with Bitcoin for your burger.
However, such brave predictions shouldn’t be rejected at all as Bitcoin already fits a definition of a reserve currency. It has a significant mass adoption and its money supply control is superior to central banks”. You know, if this happened, the earliest Bitcoin holders would be billionaires.
Bitcoin Becomes the New Gold
People usually buy gold in uncertain times to ensure their capital. Doesn’t this remind you of last year’s hunt for Bitcoin? Another positive yet more realistic outcome is that Bitcoin will become the new digital gold. So far, Bitcoin has become more appropriate as a valuable commodity than a payment method.
This prediction is based on the theory that Bitcoin’s price is going to rise (drastic fluctuations are expected) until it finally gets stabilized to the same level as gold. Bitcoin will remain in high demand, more expensive and prestigious than today. People have already gravitated towards the digital economy, so why would they step back now?
Bitcoin Will Be Forgotten
A big rise comes with a bigger fall. Despite the huge trading volumes and legitimate profits, the world of today is full of crypto pessimists. They stick to the idea that Bitcoin’s sensational price will be followed by a sharp fall to such a level that Bitcoin will become worthless and forgotten. Maybe not so fast by those who invested their life savings in blockchain-based currencies. There are a couple of arguments for this undesired turnout.
One is that developed countries will find a way to stop the popular crypto game as their financial systems are intimidated by the decentralized nature of Bitcoin. Another is that a different cryptocurrency will take over the place of Bitcoin.
However, there are far more arguments against the Bitcoin fall.
First and foremost, Bitcoin is now deeply rooted in the world’s economy, building an entirely new industry field, which makes it highly unlikely that it will just vanish overnight. The new industry consists of substantial products, corporate investments, specialized services, and Bitcoin communities. After all, Elon Musk has bought $1.5 billion worth of Bitcoin with a clear plan to start accepting it as a regular payment method. If the first scenario comes true, you’ll be able to buy a Tesla in no time.
No matter how assertive experts and crypto-savvy professionals may sound, nobody can predict which path Bitcoin will follow and that is part of its charm. But, based on technical analysis and the general public, the price of Bitcoin is likely to have a bright future — to get a piece of it, we welcome you to use MyBTC.ca.