As seen in the chart above and below, ’s historical trend has been to see its network value swell by orders of magnitudes over long cycles. In the chart above, you also notice that has historically led the pack, breaching milestones before its brethren. (Interestingly though, Burniske adds that it isn’t exactly “ and the nine dwarves” no longer, as have seen growth spurts and are catching up on the market leader.)
If breaches $1 trillion by January 2021, which would mark the crypto asset’s 12th year in existence, that means that would have annually grown by 10 times on average.
Why $1 Trillion Is Possible
Although Burniske’s quasi-prediction is sound, in that if historical trends are followed, ’s value could hit $1 trillion, why should it appreciate?
Well, according to industry researcher PlanB, this appreciation will have much to do with the stock-to-flow ratio (SF), which looks at assets’ above-ground stock and their inflation (flow) to try and determine value. In a recent post, the analyst claimed that as it stands currently has an SF of 25, meaning that it would take 25 years of current issuance levels to produce the current stock (17.5 million ). This is similar to silver’s SF of 22, but far under gold’s 62.
Charting these values, PlanB remarked that he sees a “nice linear relationship” between SF and the market valuation of an asset — the higher the SF, the higher the value of an asset. So once the halving hits, ’s SF will double. And according to the commentator’s chart, if the linear relationship between SF and value is held, ’s market capitalization could reach as high as $1 trillion, which would place at around $55,000 apiece.
While $55,000 for each seems irrational for most, PlanB writes that money from silver, gold, negative interest rate economies, authoritarian and capital control-rife states, billionaires looking for a quantitative easing hedge, and institutional investors will eventually flood into this space. This in and of itself may seem like a pipe dream, but some are sure that this is likely, especially with the increase in ,, and speculators looking for alternative investment opportunities.
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Published at Sat, 20 Apr 2019 23:28:03 +0000
