Crypto investment firm Pantera Capital has revealed a pricing model for Bitcoin that places the world’s biggest crypto asset by market cap at staggering new levels.
In the company’s April letter to investors, Pantera notes that one of their models, which compares the amount of new Bitcoin users to the flagship crypto’s price, reveals a terminal price of $700,000.
According to the model, BTC’s price goes up by $200 for every 1 million new Bitcoin users. Pantera Capital says the model has been accurate every single time except in February 2016, when the price lagged.
Should Bitcoin’s price continue to rise $200 every time a million users enter the market, the model suggests that BTC can surge nearly 1,200% from its current value of $54,000.
“3.5 billion people have a smartphone, the only requirement to use Bitcoin. In the long, long run – it’s not obvious why most of those won’t use bitcoin. That’s not many more than share photos on Facebook.
Using these relationships, we can postulate a possible terminal value for bitcoin. If the price continues to rise $200 per million users, Bitcoin would become fairly valued at $700,000.
At that level, Bitcoin would be worth $15 trillion – or 15% of global M2 (money supply). That seems totally doable.”
Pantera isn’t just mega bullish on Bitcoin. The firm also has a keen eye on the rest of the non-Bitcoin+Ethereum market share, which tracks the growth of all cryptocurrencies other than BTC and ETH. Pantera posits that the best opportunities and biggest gains are likely to be found outside of BTC and ETH as the rest of the industry is making gains against the two biggest crypto assets by market cap
“Bitcoin is a solid proxy for the blockchain disruption. However, it’s not everything. Bitcoin is about half of the market cap of the industry – but possibly less than half of the future opportunity…
The non-Bitcoin+Ethereum market share has more than doubled, from 16% to 34%, in the past three months. Watch this space. That’s where the largest gains are likely to be.”
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