Post
Topic
Board Speculation
Re: $10,000 when?
by
labsbitforum
on 19/11/2014, 22:06:44 UTC
Yes I made a simple math error.  I had excel open working on something else and copy paste failed me.  Corrected.  Doesn't change my point that that level is not realistic or sustainable.  dinofelis offers the only scenarios remotely plausible where this could happen.

You can have an idea what are the conditions for bitcoin to reach $10,000.- per coin. 
If you consider bitcoin as a monetary unit, then it would mean a market cap of $150 billion grossly, which represents about 3% of the market cap of USD (M2 money).  That's not an unreasonable target for bitcoin to reach 3% of the US money market.
It is about a third of the illegal drugs market worldwide.

You can also see it otherwise.  $150 billion is about 2% of the gold market cap.

I think you made a slight mistake in your calculation: 36 million per day means 13 billion per year, not 493.  The inflation rate today is somewhat less than 10% per year.  That is still problematic as it is still much higher than the monetary inflation of most big fiat currencies: for the moment, it is bitcoin which is by large the most inflated currency.

So if bitcoin becomes a success on the few percent level in the gold market or the money market, $10 000, - is reasonable.

On the other hand, you do not do that overnight.  In order for 3% of the US economy to be paid in bitcoin, will take a certain time.  And it has to be really in bitcoin, not just "using bitcoin a few hours between buying the coins, spending them, and the merchand trading them back into fiat".
It means: being paid in bitcoin each month, keeping bitcoin as one's salary, and spending it at the groceries.

Not yet.  But if bitcoin is to become somewhat of a monetary success, a few percent of the market would be the minimum one would expect, no ?

On the other hand, a surge to $10,000.- cannot be stable if the fundamentals (a few percent of the gold share, a few percent of the US economy) are not there, or are not in sight.  So that is not sustainable.  If ever there is a pump to $10.000,- it will for sure be followed by a huge crash.   But, apart from a massive market manipulation, I wonder who would be the idiots to buy at $10.000,- in the coming years.  Or even to buy at a few $1000.- as long as a single percent of the market share is not in sight.