Topic: If only 1% of "all the money in the world" was in bitcoin... (Read 1161 times)

I agree with a lot of this. One BTC should be around the same unit value as a Euro or USD. Maybe they could do a 1000:1 split. I know this has been talked about a lot in other posts.

My country has 20M people in it. Our average GDP is about 5000 USD per capita. If we all used bitcoin for wages and taxes, each coin would be worth about 4500 USD. However, people have assets that take around 20-30 years to grow or obtain (sometimes more than a lifetime), this value is not included in the GDP. This requires a coin to be worth over 100 000 USD if only my country uses it.

During our remaining lifetime, the world will reach 10B people (or 500 countries), making the counter-party for each coin worth 50 000 000 USD. Now you decide how much of the bitcoin will actually be available for use, and how much of the world monetary base will be put into Bitcoin.

Let's say half the Bitcoin will actually be available and is not in locked/forgotten/hodling wallets. And if 1% of all the money in the world will be in Bitcoin: 1 BTC = 1 000 000 USD

Live long and prosper!

There's still a significant psychological barrier at $1000 per coin. As long as we stick to the BTC unit as the main denomination, that barrier will remain.

Satoshi's or mBTC or something similar should've been adopted as the main unit a long time ago. Price can't stay above 1000 for long. People are too irrational to buy one unit of digital money costing more than a thousand dollars. But they might be stupid enough to buy 100 mBTC's for the same amount of $.

It's all about branding, PR and making a safe, reliable, user-friendly infrastructure. Fix all of this, and we might go high in the long term.

I'm familiar with that work.  He does come close to using a money supply calculation in that very opaque reference to M2 of a medium sized nation, but it is there.  

Obviously, I could be wrong, but in my view:
1)  His velocity calculations are incorrect.  He overstates current velocity by including too many transactions that aren't included in typical velocity calculations, and
2)  I believe that he is adding things that aren't additive.  If you're going to use M2, you can't really ADD it to things like the global remittance market, because that is part of M2.  

Let's face it.  One has to pull numbers from one's ass to make a calculation on future value.  I just think he is pulling too many numbers and trying to piece together all those guesses.  I prefer to make fewer guesses on a larger macro scale.  

I agree my guesses are pretty conservative, though.  It could well be much higher.  Could also be lower, of course.  And then don't forget that price and value are frequently not synced.  Price could EASILY, EASILY overshoot value (and usually DOES) in periods of adoption and growth.  And as we've seen, price also undershoots value to the downside at times.  So even if a reasonable, M2 based calculation in 2020 shows a value of $3100, I wouldn't be at all surprised to see BTC selling over $10K.

In 2020, we'll all be sitting around trying to figure a 2025-2030 value.  If adoption/velocity estimates (Or Metalfe's Law calculations) make people think a fair value in 2030 will be $50K (again, not unreasonable), buying at $10K in 2020 may seem like a bargain.

I don't think you can calculate the value this way.

All bitcoins will never be in circulation. It's like a stock, if you start selling a whole bunch, it will drop value quick. Apple market cap is around 600B$. Do you think that Apple represents more than 1% of all money worldwide?

If people hodl like they say. It could increase in value a whole lot. I believe it could increase more than the 15-20k you guys say.

The bull case is actually a good deal better than that... Note that the below calcs for 10% of various medium-of-exchange uses to which bitcoin is technically very well suited. The below also considers 10% of the gold market, and 1% (one percent) of "offshored" holdings. Note that it says nothing about any percentage of total money supply, instead just looking at small portions of both medium-of-exchange and store-of-value use cases that seem well suited to bitcoin's technical advantages.

This is a high lvl decision that will shape the financial structure big time. Laws/regulation are needed and that can take atleast a year ore more to complete. I'm sure Wallstreet will join and when that happens more sort-like institutions will come all over the world to join the Bitcoin brandwagon. Who knows what will become of Bitcoin and how high the price will go.

It depends on your definition of "money".  

I think M2 is actually a better measuring stick for what BTC represents because it also speaks to money as a store of value.

Best guess I can come up with for GLOBAL M2 is around $55 trillion. I'd suspect it may inflate over the next 5-7 years to, let's say, $65 trillion.  I can't remember what the BTC emission schedule looks like, but let's say there might be 17 million BTC by then.  Total money supply in BTC, theoretically, would be 3095238, or roundly 3,100,000 BTC.  I'd say 1% is pretty aggressive, given that most of the world's population may not be capable of storing or transmitting currency in that way.  But 0.5%?  Maybe a little less?  That gets you to a valuation of $15,500.  

The other thing to consider is velocity.  I've read that people believe BTC's velocity to be similar to that of USD.  In my view, they are including mining transactions, which don't belong in the velocity discussion any more than it's a measure of velocity to have fiat coming off a printing press.  My guess is that BTC velocity will grow into a USD-like velocity, possibly slightly slower, which would grow velocity by an estimated 5x.  That gets us to a valuation of $3100.

This is long-term thinking, nothing related to price today, but I have not batted an eye at buying more and more as the price has dipped under $500.  A lot of things can happen.  The adoption trendline could accelerate or decelerate.  My pulled-from-ass guess about velocity could change.  But I think a 2020 fair value for BTC might be around $3100.  (Yes, I've done this before and came up around $2400, but I didn't factor in M2 inflation, which will, I believe, continue.)  

I don't expect to retire on 20-30 BTC.  But if that investment grows from $10K-$15K to $60-90K, it is still a lot better than many other investments I've made.  

You should try to differentiate between Wall Street and employees of Wall Street.  The employees have certainly been here for awhile, Wall street as an entitity certainly isn't here in any large capacity.  That said, even if they were, I don't particularily believe that they'd be done milking the noobvestors (such as yourself) quite yet.

 

Actually, back in November and December, people here said Wall Street money would be getting in by January of this year. And they were certain. But hey, that didn't happen. I wonder why.

It's always just a couple of months away, right?

People believe wall street money is waiting to get in, not the other way around....

Indeed.

If ...

That's a big "if", however.

It just so happens that 0.1 %, let alone 1 %, will never go near Bitcoin. In fact, smart money is leaving Bitcoin right now. That's why the price has fallen by more than 60 % since November of last year.

I maintain falling is employed by the dude that failed to crash the market yesterday.

The money supply in the world is rapidly going up. The printing presses are working overtime. 

That makes no sense, probably because you're an idiot.

PS:  Price is up, we're going to the moon.  Probably should drop your fiat bag and get on the train.

what kind of a non sequitur is this....

if Aliens use bitcoin, bitcoin will be $999999999999999999999999999999999

however, they don't

All the money in the world(cash, savings, etc) is about $25 trillion USD. It could be a lot more than this. I couldn't find any solid numbers.

All the money in bitcoin is about $6.3 billion USD.

If bitcoin could get just 1% of all the money in the world it would be worth about $250 billion USD!

The price of one bitcoin would be worth $19,000 USD!

Feel free to correct my info if you have better sources. Thanks!