Bitcoin Price Set To Skyrocket To $750,000, Says Expert
In a forecast shared via a YouTube video, Joe Burnett, Senior Product Marketing Manager at Unchained Capital, articulates a strong case for Bitcoin reaching a valuation of $750,000. According to Burnett, the market may be substantially underestimating Bitcoins potential this cycle, often losing sight of its broader context within the global financial ecosystem.
Why Bitcoin Could Soar To $750,000
Burnett begins by addressing a common oversight in market analysis, which typically juxtaposes Bitcoins current cycle against historical performances without accounting for its evolving market context. I think its possible that many people are underestimating Bitcoin this cycle, Burnett stated, emphasizing the necessity to perceive Bitcoin through the lens of its relative position in the total global wealth.
A key component of Burnetts argument is the HODL model created by the Rational Root, which he discussed extensively on the podcast What Bitcoin Did. The model pinpoints a critical inflection in 2020, coinciding with Bitcoins third halvingan event that reduces the number of new bitcoins generated and thus awarded to miners for verifying transactions.
Burnett elucidates, This model is fascinating because it shows a logical inflection point that occurred in 2020 around the third halving. It highlights that illiquid supply as a percentage of total supply held at an all-time low percentage, and its been slowly climbing ever since. According to him, this reflects a shift towards Bitcoin being increasingly held by long-term holders rather than circulated by miners and speculators.
Post-2020, Burnett argues, Bitcoin has entered a new phase characterized by a diminishing supply of liquid coins. Until the third halving, Bitcoin was really just in the process of distributing coins via proof of work mining; almost 90% of all coins were mined by 2020, he explains. The subsequent reduction in new coin generation post-halving has spurred a gradual transition from a freely circulating supply to a more tightly held asset.
Burnetts forecast also leverages a comparative analysis with gold, traditionally viewed as a robust store of value. He challenges this notion by highlighting the flaws in golds economic mechanics, particularly its annual supply increase of 1% to 2% which introduces continuous sell pressure. Gold has a negative feedback loop considering its not perfectly scarce like Bitcoin. Hundreds of billions of dollars of new gold are mined annually, Burnett points out, arguing that this diminishes golds appeal as an investment.
Conversely, he describes Bitcoins halving events as a positive feedback loop, where the decrease in new supply every four years inherently drives price appreciation, stimulating new waves of adoption. The amount of new Bitcoin being mined gets cut in half. This repeats until no newly released Bitcoin are mined, he adds, suggesting a built-in scarcity that bolsters its value over time.
Zooming out to a global scale, Burnett references the near quadrillion-dollar total global wealth, within which Bitcoins current market cap is just a fraction. He contends that Bitcoins market share is poised for significant expansion, potentially commanding a sizable portion of global wealth.
This stands in sharp contrast to more conservative expectations by various experts which barely see Bitcoin crossing the $100,000 threshold in the near future. With all that being said, the concept of diminishing returns could very easily be flawed. We live in a world with nearly 1 quadrillion dollars of total global wealth and Bitcoin is 0.1% of that, Burnett states.
He concludes with a quote from Michael Saylor: All your models will be broken, and added anything below the size of gold is absurdly early. Gold parity is now at about $750,000 per Bitcoin, meaning if the market size of Bitcoin just reached the market size of gold.
At press time, BTC traded at $
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Text source: NewsBTC
