Here is a quote from far back in 2011 by Hal Finney –
Bitcoin has the potential to become the dominant currency for large-scale electronic transactions worldwide. If this happens, bitcoins could be worth millions of dollars each. I see the recent increase in value as a rise in the consensus probability that bitcoin will succeedHAL FINNEY | FEBRUARY 10, 2011
Hal Finney was the recipient of the first Bitcoin transaction from Satoshi Nakamoto. It can be argued that Hal Finney is Satoshi himself or at least knows who Satoshi was. He was undoubtedly bullish on bitcoin reaching a value in the range of 1 million dollars or more. It might take a while but eventually, bitcoin will get to that landmark price.
Historic Value for Bitcoin
Ten years ago(2013), the price of bitcoin ranged between $13 – $1100, that account for a 2500 – 215,000 percent increase in price for 2013. From the first recorded notable sales in 2009, it has seen a growth of over 75 million percent increase. Bitcoin only crossed the $1000 mark in 2017, and less than a year later in 2018 it crossed $10k and had a peak value of $67k in 2021.
If history were to repeat itself, we would be having bitcoin at the dream landmark price maybe in another decade. The turn of global events will determine the tide in the rise of the price of Bitcoin. While previous performance may not represent future performance, it is not out of the realm of possibility to see even more parabolic growth in the price of Bitcoin.
There have been many several booms and burst market cycles for bitcoin, the result has always been a higher price for bitcoin (as shown in the figure above. (Historic data available at https://dune.com/imranlimransid/bitcoin-price)
Bitcoin All-Time High And the $1 Million Dollar Mark
Bitcoin had its All-Time High at $67,567 on November 8, 2021. (Bitcoin’s All-Time Low is $0.0009, Martti Malmi – a Finish developer that worked with Satoshi sold 5050 bitcoins for $5.02). It will take only 15x for Bitcoin to move from its all-time high to 1 million dollars apiece. Bitcoin ATH is over 75 million times its all-time low. Making bitcoin historically one of the best-performing assets or currencies (whichever is more suitable).
To put things in better perspective, bitcoin ATH represents only a tenth of the Global Market capitalization for Gold which currently stands at about $13 trillion. A $1 million dollar Bitcoin tag would require Bitcoin to exceed Gold in market capitalization. That could take a while and will more likely require more crypto-friendly regulations from Governments across the world.
So could Bitcoin realistically do a 15x growth from its all-time high of $67K? That will depend on a number of factors that are highlighted below.
What Could Drive The Price of Bitcoin To $1 Million
Bitcoin price responds more to fundamental factors rather than technical factors. Huge spikes in the value of bitcoins are usually the result of news and changes in public perceptions. A combination of all or some of the under-listed will constitute the factors that could potentially push Bitcoin to the one million dollar price tag:
The largest influence is arguably from Government support. When there are favorable legislations crypto legislations in some big global players like the US and China, it is not hard to see bitcoin price “to the moon” as it will improve public adoption and use of bitcoin. Access to banking facilities to crypto starts, investments in crypto-related events, and a generally healthier atmosphere for Bitcoin. Current restrictions limit the level of investments in bitcoins
2. Mass Adoption of Bitcoin
Estimates as of January 2023 put the number of crypto users at around 430 million or about 4.3 percent. Also, about 65 percent of crypto users also own bitcoins, which puts the number of bitcoin users is about 3.5 percent. Compared with 65 percent of people over 14 years who own a bank account. There is so much room for Bitcoin adoption and growth.
According to Crypto influencer David Lark, the number of Bitcoin users is expected to hit 1 billion users by 2027 (a projection from a chart he made comparing Bitcoin adoption with that of the internet). Mass adoption of bitcoin has steadily been on the increase and the negative perception of its being a tool for nefarious activities is gradually dying off. The more the adoption, the better the price of bitcoin, it is reasonable to project a one million dollar price for bitcoin with 1 billion users.
3. Institutional Investors
This is usually a follow-up to favorable national legislation that favors bitcoins and cryptocurrencies. Institutional investors could become major players in the Bitcoin ecosystem. Hedge funds, Banks, and Investment groups can devote a portion of their portfolio to bitcoins resulting in increased price momentum.
Most of the current bitcoin products offered by institutions do not actually involve the actual use of bitcoins, the forces of demand and supply will ensue if institutions were to purchase real bitcoins from the market. A change in tide could have a more positive outcome.
4. Global Events
A number of world events could spike an unexpected rise in the value of bitcoins. An event that could result in a lack of trust in the government and as such people choose an alternative vehicle to store their assets. Hyperinflation in hitting the US could theoretically result in Bitcoin exceeding the $1 million mark.
There are speculative bets in this unlikely scenario, a former CTO at Coinbase Balaji Srinivasan has placed a $1 million bet on the price of Bitcoin rising to $1 million by June 17, 2023. sparked by the debate on Hyperinflation hitting the US.
5. Big Tech Adoption of Bitcoins
This is a no-brainer, when the likes of Amazon, Microsoft, or other big corporations openly unveil their support or integrate Bitcoin as a payment option in their ecosystem, we will see massive gains in bitcoins. They hold some of the most powerful tools in society and can even influence government policies. The last rally to its all-time high had some boost with support from Elon Musk and speculations that his company – Tesla – will be accepting Bitcoin as a payment option.
6. Adoption As National Currencies or As Legal Tender
Bitcoin is currently accepted as legal tender in El Salvador and the Central Africa Republic as possibly in a bid to reduce dependence on the US dollar in global trades. If many countries do the same, particularly the larger economies, the demand for bitcoin would be significantly more and prices will dramatically increase for bitcoin.
7. International Trade And Reserves
This could be quite a stretch. But there is a possibility that Bitcoin could someday be used by some countries in international trade. There are no Central banks over controls over Bitcoin and it, therefore, offers a level-play ground for all countries to conduct trade in an open and transparent manner. If only a tiny fraction of international trade or settlement is done in bitcoins, there will be no bounds on how far it can go in price.
Bitcoin has historically performed far beyond what is possible in traditional finance and assets. It could hit a million dollars within the next decade if its current trend is sustained and a number of key events happen within the time frame. Some of these would include favorable legislation by some key Government players like the US and China, increased mass adoption, adoption by big tech giants major corporations, Institutional Investors, Improved public perception and mass adoption, Institutional investors, etc. The best days of Bitcoin price appreciation are yet to come.
Yahoo Finance (bitcoin historic price chart)