Bitcoin’s Outlook [2021 — Beyond]
According to a recent study, only about 1.3% of the world’s population currently owns Bitcoin!
Over the next few years, we are likely to encounter a number of mainstream growth catalysts, each attracting millions of new individuals to Bitcoin, both actively and passively, and pushing the price to new highs.
Here’s what they may look like:
1. Massive Wall Street inflows have only just begun (i.e. Hedge Funds, Brokerages, Sovereign Wealth Funds, Pension Funds)
2. Sweeping regulation to further protect investors and build investor confidence in rapidly evolving market.
3. Regionalized adoption due to poor monetary policy or geopolitical conflict (i.e. Argentina; Hong Kong; Nigeria)
4. Traditional brokerages including Fidelity offering cryptocurrency and ancillary products such as a Bitcoin ETF.
5. FOMO — retail investors will continue to pile in as the price increases out of a Fear of Missing Out.
6. Purchased and held as hedge against a weakening $USD.
7. Supply shock — global demand will outweigh total supply (21,000,000 Bitcoin) as corporations and individuals store their Bitcoin long term, causing further price surges.
If these catalysts come to fruition, Bitcoin’s 4th adoption cycle will likely culminate between 2023–2025 around $100,000–$200,000 — or a $2 trillion to $4 trillion market capitalization.
It just seems logical for the only digitally-native, borderless currency, to capture a mere 2% share of the global monetary supply ($2 trillion). Especially in an ever-digitizing, ever-globalizing economy.
Keep in mind, as with each cycle prior, it’s likely a combination of unforeseen geopolitical headwinds, continued regulatory frustration, and the stalling out of broader adoption efforts as a functional currency will likely trigger its next leg down. A logical move before entering a possible 5th and final cycle.
Stay tuned to see what this could look like!
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The views above are opinions of the author and not to be taken as investment advice.
