More

    [Bitcoin Spreads Like a Virus] BTC Price to $1 Million USD in Coming years, Crypto Analyst Explains the Parabolic Why

    It is always fun to search and research all of the latest bitcoin price predictions the market and community has to offer. The latest, which is mind-bendingly awesome, comes from a highly respected academic. Here is what he had to say: Bitcoin is going to hit $50,000 in 2022 and in about a decade cross the $1 million per BTC mark, according to the parabolic trend Bitcoin has been following as per Crypto analyst, Cane Island Crypto.

    Now, Timothy F. Peterson, the founder and investment manager of Cane Island Alternative Advisors explains why is this a real possibility in his paper titled, “Bitcoin Spreads Like a Virus.”

    According to this paper, the long-term price of Bitcoin is not random rather is network economics that represents the growth rate in users that has a considerable effect on the BTC price by observing the data for both Facebook and Bitcoin.

    Fundamental Value of Bitcoin

    The value of a currency depends upon its use and acceptance and in case of Bitcoin, as cited by Federal Reserve, it has two key properties viz. permissionless access and decentralized database management.

    Moreover, “database management systems can have a fundamental value if they are tailored to meet the needs of a given constituency.”

    So, the author says, unlike the common and misinformed belief of “value is a mystery” myth regarding Bitcoin, is countered on the above counts.

    Actually, no modern currency, even the sovereign fiat currency have any intrinsic value along with commodity money that offers durability and scarcity that paper money doesn't have. He further shares the explanation provided by Federal Reserve Bank of St. Louis to state that the lack of fundamental value is not the same as having no value, rather normal and acceptable characteristic of commodity and fiat money.

    “Gold, for example, trades above its value as measured by its industrial applications. The U.S. dollar trades above its fundamental value in discharging U.S. tax obligations. The premium some people are willing to pay for gold and the U.S. dollar reflects the value these objects possess as exchange media. The market value of these objects would decline, but not fall to zero, should this premium suddenly vanish.”

    Users’ Driving the Price

    In the short term, the author says, noise is the dominant driver of price and volatility. And the market consuming and spreading the nose about bitcoin and crypto is “not noteworthy.”

    However, over time, the price tends towards value. He further says, the model presented here is to suggest that the probability of extreme price crash or soar is “very small” as the number of users is driving the price.

    By using Metcalfe's law that is a typical approach to crypto valuation, the price is a function of n users. However, it differs from other past modes in the way that over time, in might grow at a non-constant rate. Here is the abstract to the Bitcoin Spreads Like a Virus paper:

    We illustrate, by way of example, that Bitcoin’s long-term price is non-random and can be modeled as a function of the logistic growth of number of users n over time. Using observed data for both Facebook and Bitcoin, we derive the relationships between price, number of users, and time, and show that the resulting market capitalizations likely follow a Gompertz sigmoid growth function. This function, historically used to describe the growth of biological organisms like bacteria, tumors, and viruses, likely has some application to network economics.

    Peterson concludes the paper with, “we confirm past research that the long-term growth rate in users has considerable effect on the long-term price of bitcoin.”

    Live Bitcoin (BTC) Price:

    1 BTC/USD =$6,452.5925 change ~ 2.82%

    Coin Market Cap

    $118.06 Billion

    24 Hour Volume

    $7.76 Billion

    24 Hour VWAP

    $6.4 K

    24 Hour Change

    $182.0033

    BTC Price Analysis' Week in Review:

    Find Us: Telegram \\ Facebook \\ Twitter \\ Live Prices \\ Today’s News \\ BTC Charts

    Get Free Email Updates!

    *Action* Enter Best Email to Get Trending Crypto News & Bitcoin Market Updates

    I will never give away, trade or sell your email address. You can unsubscribe at any time.

    AnTy
    AnTy
    AnTy has been involved in the crypto space full-time for over a year now. Before his blockchain beginnings, he worked with the NGO, Doctor Without Borders as a fundraiser and since then exploring, reading, and creating for different industry segments.

    [Alert] Use the author's self-conducted information at your own risk, do you own research, never invest more than you are willing to lose.

    [Disclosure] The published news and content on BitcoinExchangeGuide should never be used or taken as financial investment advice. Understand trading cryptocurrencies is a very high-risk activity which can result in significant losses. Editorial Policy \\ Investment Disclaimer

    LEAVE A REPLY

    Please enter your comment!
    Please enter your name here

    3,353FansLike
    2,773FollowersFollow
    4,130FollowersFollow

    Live Bitcoin Price & Latest BTC Charts

    Today's Latest Crypto News

    Crypto Community Sentiment Still Bullish Despite BTC Trading 40% Lower Than Yearly High

    Bitcoin proponents had a lot of expectations from 2020, given the impending Block Reward Halving and the expected bull run. The year started as...

    Modern Monetary Theory (MMT) vs BTC to be the Main Event of 2020

    The biggest global emergency of the century, COVID-19 pandemic has the Treasury officials trying to decide on how much they can spend to fight...

    This Crisis Is A ‘Perfect Storm' For Bitcoin But We Could Be In For A ‘Prolonged Bear Market'

    Bitcoin is back in the green, recording the gains of 3.14% in the past 24 hours while volume on the top ten exchanges with...

    Banking Giant Santander to Bring One Pay FX Payment System to Mexico Utilizing RippleNet

    In 2020, the major Spain-based bank Santander is planning to roll out the One Pay FX program, its Ripple powered system for international payments,...

    Bitcoin Bull Market Won’t be Happening Immediately After the Halving: Bitmain CEO

    Bitcoin is currently trading above $6,300, still down over 14% on a year-to-date basis but up more than 60% from the 2020 low of...

    BitcoinExchangeGuide is a hyper-active daily crypto news portal with care in cultivating the cryptocurrency culture with community contributors who help rewrite the bold future of blockchain finance. Subscribe on Google News, see the mission, authors, editorial links policy, investment disclaimer, privacy policy. Got News? Contact us, we are human too. Note: nothing here is financial advice, do your own research thoroughly.