Bitcoin is breaking record highs left and right. Only a month ago, on May 20th, the digital currency hit $2,000 for the first time ever, and $3,000 last Monday, something many thought would never happen. But what comes up, must come down, as they say…and that certainly seems to be the case with Bitcoin.
The world hardly had the chance to revel in its excitement, however, before it bottomed out to $2,463 the very same day. Today, Bitcoin is sitting around $2,566.00 at the time of this writing. So, now that we have seen Bitcoin reach the $3,000 mark, could it reach $6,000 or, even higher, $100,000?
One analyst believes Bitcoin could reach $100,000 and in only 10 years time. The man behind this mega prediction is Kay Van-Petersen. He is a Global Macro Strategist at Saxo Bank, a Danish investment bank renown for its expertise in online trading and investment. With his new prediction, Bitcoin’s market cap would rise to $1.75 trillion by 2026.
Its Van-Petersen’s belief the entire digital currency market is set to dramatically increase over the next decade. He says within this time period, digital currencies could account for 10 percent of fiat currency’s average daily trade volumes, or $500 billion dollars (10 percent of the $5 trillion foreign exchange ADV).
Let’s say Bitcoin maintained at least 35 percent of the $500 billion dollar cryptocurrency market, daily Bitcoin trading would be at the $175 billion mark. But in order for Bitcoin’s market cap to reach $1.75 trillion, it would need to exceed the average daily trade volume ($175 bln) by ten fold.
For his prediction to come true, the number of Bitcoins in the circulating supply would also need to be at least 17 million, not too far from the current 16.3 million. Now, divide 17 million BTC by $1.75 trillion, and there you have one Bitcoin priced at $100 grand.
This prediction is quite impressive, and so are Bitcoin’s growth rates. In April 2017, the average price Bitcoin traded at was $1,384.6. The following month, the price jumped to $2,303.3, a 66% increase.
What’s Pushing Bitcoin to New Heights?
A few things are responsible for Bitcoin’s fast trail upwards this year. Two main events have played the biggest role in Bitcoin’s price surge. Firstly, Japan legalized Bitcoin on April 1, 2017. This legislation has greatly increased investor interests in Bitcoin from Asian countries, particularly Japan and Korea. Secondly, a resolution to the long-running Bitcoin scaling debate was announced by Digital Currency Group last month. Although there is fierce debate over whether the Bitcoin Scaling Agreement is the best route to take, it has increased some investor’s confidence in the currency’s long-term potential.