Fidelity Exec Compares Bitcoin to Apple

In his recent Twitter threat, Jurrien Timmer, director of global macro at Fidelity says that the number of active Bitcoin addresses continues to grow steadily despite the price drawdown, comparing the largest cryptocurrency to tech behemoth Apple.   

Timmer names Apple’s massive growth over the past three decades as yet another example of an S-curve.

An S-curve is a mathematical model that is applied to demonstrate growth in a variety of different fields. The pattern helps to illustrate the introduction and adoption of certain technologies such as mobile phones and the internet.

The exec has estimated that Apple’s network has experienced 53-fold growth since 1996 based on its sales while the company’s market value has seen a 1699-fold increase.     

Timmer points to the fact that Apple’s price has increased in tandem with sales growth and valuation growth:  

Apple’s price has grown 1457x since 1996, while its price-to-sales ratio has grown 30 times. (See below.) If the growth in valuation is an exponent of the growth in sales (per Metcalfe’s Law), then price should increase as an exponent of both metrics. For Apple, it has.

He then calculates Bitcoin’s valuation while applying Metcalfe’s law, which says that the valuation of a certain network is proportional to the square of the number of users:

Bitcoin’s valuation has increased 867x since 2011, while its price has increased 640,633x. If we apply Metcalfe’s Law and calculate the square of 867, we get 751,111. This is roughly in line with the 640,633x realized price gain.

Timmer concludes that Bitcoin and Apple follow a similar path of growth despite the fact that these technologies. 

Below is a side-by-side comparison of Apple and Bitcoin. Different animals to be sure, but they follow a similar path as dictated by their network growth. /9 pic.twitter.com/N89L39pPb9

— Jurrien Timmer (@TimmerFidelity) February 17, 2022

$100,000 is still on the cards

In an October interview with CNBC, the Fidelity exec predicted that the Bitcoin price would reach $100,000 by 2023.

He sees Bitcoin as a “convex version” of gold, which is considered to be a traditional safe-haven asset.

Yet, despite being bullish on Bitcoin, Timmer is convinced that Bitcoin will not threaten the cryptocurrency’s adoption, predicting that the largest cryptocurrency will actually help the greenback to maintain its dominance.