BitcoinSpotlight

Bitcoin Price Should be About $10 Million – If All BTC Were Mined

The price of the world’s leading cryptocurrency by market capitalization, bitcoin, is often seen riding on a roller coaster. Sudden spikes take the price up to almost $20,000 as seen back in 2017, and sudden drops bring it to the lows of even $3,000s as seen at the beginning of this year.

At the time of writing, bitcoin is standing at around $11,627 while showing a major 3.08% increase in the past 24 hours alone. So the million dollar question in this scenario is: what is the actual worth of bitcoin? What should be the digital asset’s natural price irrespective of the bull and bear runs?

BlockPublisher got in touch with the co-founder of Billfodl.com (a private key security company), Colin Aulds, as he opined about the possible natural price or worth of bitcoin. As per Colin, the natural worth of bitcoin depends heavily on its primary use case.

Is it to act only as digital gold? Then, if successful, the price of 1 Bitcoin (if all 21 million were mined) should be about $378,000. If you think Bitcoin should become the world’s primary reserve currency (as I do), then 1 Bitcoin should be worth about $10,000,000….*if it can achieve this status*.

Gold has remained the representative of value in the society since the early ages. It was there even before the centuries-old system of banking and fiat came into existence. Bitcoin, on the other hand, is only a decade-old system with a lot of technological and legislative hurdles sticking to it.

READ ALSO: 2020 Bitcoin Halving – Crypto Asset Price Could Experience 10x

Since it has no physical existence as well, the aspect of it becoming the digital gold and replacing actual gold seems quite bleak. When it comes to the possibility of bitcoin becoming a global reserve currency, it is certainly there. If bitcoin is to challenge the banking system, there probably is a need for it to become a credible global currency. Despite the aim, there are some strong technological hurdles in the way, the prime one being scalability.

At the moment, the clarity around bitcoin being the digital gold or a reserve currency is not achieved. Some people use it as a store of value like gold while some use it as a source of making payments. But its the price volatility problem that stains bitcoin’s capability of acting as a global reserve currency in the eyes of some.

There are many regulatory restrictions currently associated with bitcoin as well, that halt its way towards becoming a globally recognized and credible currency. It is even banned in countries like India and China. Amid all this struggle comes the major problem of transactions per second (TPS).

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Bitcoin handles only around 4.6 transactions per second in the network while for the leading world money transfer system, VISA, the TPS number is over 1,000. Scalability is a recognized problem in the bitcoin ecosystem. Becoming a global reserve currency means handling the transactions made by billions across the globe. The world population is on a steep rise and in time the scalability problem will become ever more prominent.

Summing the situation, Colin said:

It is my opinion that the vast majority of bitcoin’s value proposition is in the latter use case of world reserve currency. If it cannot rise to the occasion and scale to meet that goal, then I fear its true value is almost 0. This makes valuing bitcoin a very challenging task.

Right now, the only thing that is maintaining the value of bitcoin in the market is speculation, that is people believing this asset carries value and will be worth something in the future as well. There is no commodity like gold or oil backing it.

The price of the world’s biggest cryptocurrency that has a market cap of over $200 billion is treading on the thin ice of speculation. Bitcoin needs to clearly define its role and adapt accordingly in the long-term. If it is unable to tackle the scalability and regulatory issues, the worth of this speculation-based digital asset which has no physical backing might just come crashing down to zero.

READ ALSO: Bitcoin Price Will Reach $100k by 2021 – More Volatility Expected

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Ahsan Khalid

Blockchain Developer. An Electrical Engineer with majors in software development. I present forward my insight regarding the latest happenings of the blockchain world. All views on my articles are my own. Email: ahsan@blockpublisher.com or editor.news@blockpublisher.com

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