VanEck, a prominent asset manager and Bitcoin ETF issuer, recently released a detailed forecast regarding the future value of Bitcoin.
The $108 billion asset management firm envisions Bitcoin playing a substantial role in international and domestic trade by 2050. The firm forecasts that BTC could settle 10% of the globe’s international and 5% of domestic transactions.
According to VanEck’s estimation, this scenario could lead central banks to hold 2.5% of their assets in Bitcoin, driving its price to an estimated $2.9 million per Bitcoin. Notably, this lofty price point would elevate Bitcoin’s market cap to approximately $61 trillion.
VanEck also projects that Bitcoin Layer-2 (L2) solutions, which address scalability issues, could collectively be valued at $7.6 trillion, approximately 12% of Bitcoin’s total value.
Worst-case Scenario at $130,314
It is worth noting that VanEck’s $2.9 million projection for Bitcoin by 2050 is the ‘base case’ for the premier asset. In the best-case scenario, Bitcoin could reach $52,386,207. Meanwhile, VanEck’s worst-case scenario for Bitcoin by 2050 is a price of $130,314.
Shifting Dynamics in the IMS
A key driver of VanEck’s bullish outlook on Bitcoin is its potential to emerge as a reserve asset. To grasp this potential, the asset manager suggests examining the evolving trends in the International Monetary System (IMS).
According to VanEck, the declining global GDP share of major economies such as the US, EU, UK, and Japan will likely trigger a shift towards alternative reserve assets. This shift is compounded by waning confidence in traditional reserve currencies, fueled by concerns over deficit spending and geopolitical instability.
As a result, businesses and consumers may increasingly turn to Bitcoin as a neutral and reliable medium of exchange, drawn to its predictable monetary policy and immutable property rights. VanEck posits that these shifting economic dynamics could accelerate the adoption of Bitcoin as a global reserve currency, positioning it as a viable solution to the limitations of traditional fiat currencies.
Contrasting Views
However, not everyone shares VanEck’s optimism. Crypto commentator Kal Benz calls VanEck’s $2.9 million Bitcoin price forecast by 2050 “bearish.” Notably, considering Bitcoin trades at $59,000 today, a price point of $2.9 million amounts to a staggering growth of 4,815%.
However, adjusted for 5% inflation, Benz observed that it is equivalent to $856,000 in today’s dollars or a 10.7% ROI. Factoring in 5% annual monetary debasement, it’s worth just $267,000, a 6% ROI.
Meanwhile, some market participants are sounding caution, warning of potential downside risks. A prominent crypto trader has even predicted a significant drop in Bitcoin’s value, potentially as low as $16,000 if Vice President Kamala Harris wins the presidency in November.
This bearish outlook is rooted in concerns about the current administration’s regulatory stance on cryptocurrencies.
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Source: https://thecryptobasic.com/2024/09/03/vaneck-sees-bitcoin-hitting-2-9-million-with-61-trillion-market-cap-heres-the-strategy/?utm_source=rss&utm_medium=rss&utm_campaign=vaneck-sees-bitcoin-hitting-2-9-million-with-61-trillion-market-cap-heres-the-strategy