After the crypto world recently recovered a bit, optimistic voices are now increasing again. Crypto investor Chris Burniske believes that Bitcoin could reach a market capitalization of 1 trillion dollars.
Chris Burniske, former crypto chief at ARK Invest and partner of New York-based venture capital firm Placeholder VC, has recently been extremely bullish about the future development of the most popular crypto currency, the Bitcoin. According to him, Bitcoin’s market capitalization is likely to exceed $1 trillion during the next bull market, which would mean a price of around $50,000 per coin.
Trends point to record
The expert’s forecast is based on trends in the top 10 crypto assets, which were recorded from 2013 to 2018 and thus periodically analysed over six different periods. Two anomalies were identified:
During the rally in December 2017, when the Bitcoin almost broke through the 20,000 dollar mark, market capitalisation rose to 813 billion dollars.
In the 2018 crypto winter, however, the valuation fell from 700 billion to around 100 billion dollars.
Fomo likely to drive investors
In order to achieve such a proud rating, the Bitcoin would have to become a recognized value store with a robust infrastructure, the general adaptation would have to progress further. Some investors, including billionaire Mike Novogratz, also believe that the commitment of institutional investors plays an important role. “It won’t go there immediately. What will happen is that one of these intrepid pension funds, someone who is a market leader, will say: You know what?
We have the custody, Goldman Sachs is involved, Bloomberg has an index with which I can track my performance, and they will buy. And suddenly the second guy buys. The same Fomo they saw in ordinary trading [will also come from institutional investors],” Novogratz told Bloomberg some time ago, pointing out the Fomo phenomenon. Novogratz aims to get more people to buy Bitcoin if they’ve already bought it before – because of the fear of missing out. In recent months, it has also been observed that the interest of institutions has increased sharply.
Ethereum, Litecoin & Co. catching up
Looking at the chart of the development of the top 10 crypto assets, Burniske also pointed out that other crypto currencies such as Ethereum, Litecoin, Ripple & Co. were slowly catching up. The crypto market used to look like “#Bitcoin and 9 Dwarfs”, but that has changed in the meantime. Especially since 2017, these “dwarves” have experienced rapid “growth spurts”.
The venture capitalist believes that “the markets are full of faith”. “Some will object to my use of this term, […] but basically anyone who distributes capital believes that the system will produce future values > present values, an unknown future state that we dream of together with our faith,” twittered this author.
Currently, a Bitcoin is traded at around $5,555, with market capitalization at around $98 billion. So the way to the 1 trillion dollar valuation is still a long one. Whether the Bitcoin can actually make such a big step during the next bull market remains exciting.