Bitcoin (BTC) could rally by double-digit percentage points from the current level if it captures just a tiny share of the global liquidity and gold’s market cap, according to a report by digital asset investment firm CoinShares.
The report says that based on the total addressable market (TAM) model, the crypto king could go up by 65% from the current level if Bitcoin captures just 2% of the global liquidity (global M2) and just 5% of gold’s market cap.
The TAM model is a tool used to estimate the maximum opportunity available to a product or service, in this case Bitcoin, assuming it is able to capture the entire market.
“…if you believe bitcoin is unlikely to compete with the cash positions of Corporate Treasuries or FX Reserves (assigning them 0%) but more likely to take a share of Global M2 (let’s assume 2%) and Gold (5%), the sum of those contributions would estimate a value of US$189,000/BTC.”
According to CoinShares, the global liquidity (global M2) is currently at $127.3 trillion, while the total market cap of all the mined gold is $23.9 trillion.
The digital asset investment firm further says Bitcoin is “increasingly likely to obtain a higher share of monetary markets” as it becomes a “more useful form of money.”
“Bitcoin does not need to replace the global monetary system to be profoundly valuable. Capturing a small share of these enormous markets would be more than enough.”
Bitcoin is trading at $114,800 at time of writing.
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