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A lot of sky-high Bitcoin price predictions from credible sources have been popping up lately.
In the near term - by the end of 2020 - we're seeing Bitcoin forecasts as high as $50,000.
Longer-term Bitcoin price predictions soar into the six figures. The highest foresees the price of Bitcoin hitting $1 million by 2025.
No doubt such predictions will strike many as crazy given the current Bitcoin price of about $9,250. Since climbing to the 2019 high of $13,793 on June 26, the world's very first cryptocurrency has struggled to sustain a rally. For most of the past 12 months, Bitcoin has ranged between $7,000 and $10,000.
And yet, we're seeing more signs that interest in this new asset class is building...
Investors Are Jumping on the Bitcoin Bandwagon
First, it's vital to understand that the total supply of Bitcoin is fixed. And it is designed to decline (via the periodic "halvings" of the block reward) until it reaches a cap of 21 million BTC.
So demand, then, is the key to future price increases.
Retail investors, long the mainstay of Bitcoin buying, have been more active than ever this year. Derivatives exchange ZUBR, using data from Chainalysis, found the number of new wallets continues to grow. The firm predicts that within four years, demand from retail buyers will eat up more than half of the daily supply of freshly mined bitcoins.
At the same time, more big investors are joining the party. This includes pension funds, family offices, and hedge funds.
Inflows into Grayscale Bitcoin Trust (OTC: GBTC) doubled from the last quarter of 2019 to the first quarter of 2020. According to Grayscale, 88% of the money came from large investors, mainly hedge funds.
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More than a third (36%) of large investors in the United States and Europe already own some sort of crypto asset, according to a recent survey from Fidelity Investments. More than a quarter said their holdings included Bitcoin.
One well-known Wall Street-type investor to put money into Bitcoin is hedge fund manager Paul Tudor Jones. In a May CNBC interview, Jones said he has almost 2% of his assets in Bitcoin.
With a $5 billion net worth, that means he has roughly around $100 million in Bitcoin alone.
Calling cash a "wasting asset" due to inflation, Jones said he also owns gold as well as other inflation hedges. But Bitcoin, he said, "may end up being the best performer of all of them."
That kind of thinking - which is growing more common by the day - is why lofty Bitcoin price forecasts aren't farfetched.
Bitcoin Price Predictions for This Year and Next
Bitcoin forecasts for the near term see big gains ahead.
The Crypto Research Report for June 2020 makes a detailed case for a steep Bitcoin price increase, citing its role as a store of value as well as rising adoption. It says Bitcoin will reach $19,044 by the end of the year.
Antoni Trenchev, co-founder and managing director of crypto-lender Nexo, told Bloomberg he thinks Bitcoin can get to $50,000 by December.
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Looking a bit further out, there's the chart-based forecasting of a crypto personality who goes by the moniker "PlanB." He uses a model called "stock to flow," which is the ratio between the new supply of an asset and its existing stock.
Last year, PlanB's model forecast a Bitcoin price of $100,000 by the end of 2021. In April, he updated his model - and his target - to $288,000.
Read about PlanB's new "stock-to-flow cross asset" model here.
A forecast from Morgan Creek CEO Mark Yusko favors the lower - but still lofty - $100,000 target for next year.
"I actually believe that this transition will be the biggest wealth creation opportunity I'll probably see in my lifetime," Yusko told the Altcoin Buzz YouTube channel in May.
But Yusko, like many others, sees Bitcoin soaring far beyond even $100,000 over the next three to 10 years...
Long-Term Bitcoin Forecasts That Could Mint Millionaires
In his YouTube interview, Yusko said Bitcoin will exceed $400,000 per coin over the next seven to 10 years.
"If we come to gold equivalence, meaning the market cap of Bitcoin equals the market cap of gold, which I think is perfectly logical, you could easily see that $400,000 to $500,000 price sometime," Yusko said.
The Crypto Research Report's long-term target is slightly lower - but it sees a higher price sooner. It has a Bitcoin price target of $341,000 by 2025 and $397,727 by 2030.
Adam Back, a crypto expert whose work was cited in Bitcoin creator Satoshi Nakamoto's white paper, told Bloomberg last month that he believes BTC will reach $300,000 within five years - even without a fresh wave of big investors.
The COVID-19 pandemic "is causing people to think about the value of money and looking for ways to preserve money," Back said, "and retaining value when there's a lot of money-printing in the world."
Finally, we have the boldest Bitcoin forecast of all.
It comes from Raoul Pal, a former hedge fund manager. He's the founder and CEO of The Global Macro Investor, an investment strategy research service.
In an April report, Pal gave a bleak outlook for the U.S. economy and the markets. His advice was to hedge with gold and Bitcoin. He thinks gold will rise 3x to 5x over the next three to five years.
But Pal says Bitcoin will soar to $1 million per coin by 2025 - if not sooner. That's a gain of 10,710%!
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About the Author
David Zeiler, Associate Editor for Money Morning at Money Map Press, has been a journalist for more than 35 years, including 18 spent at The Baltimore Sun. He has worked as a writer, editor, and page designer at different times in his career. He's interviewed a number of well-known personalities - ranging from punk rock icon Joey Ramone to Apple Inc. co-founder Steve Wozniak.
Over the course of his journalistic career, Dave has covered many diverse subjects. Since arriving at Money Morning in 2011, he has focused primarily on technology. He's an expert on both Apple and cryptocurrencies. He started writing about Apple for The Sun in the mid-1990s, and had an Apple blog on The Sun's web site from 2007-2009. Dave's been writing about Bitcoin since 2011 - long before most people had even heard of it. He even mined it for a short time.
Dave has a BA in English and Mass Communications from Loyola University Maryland.