Trace Mayer, long-time Bitcoin investor and evangelist, has gone on record saying that in the months after the production supply of Bitcoin halves (expected in early July) the price of Bitcoin will jump to 3,000 dollars or more. He has previously said that he expects that eventually that the value of a Bitcoin could be equal to a million dollars.
Unfortunately, one of the most frustrating things a bitcoiner can do is to watch the price move from day-to-day, or even minute-to-minute. It teeters up and down, and all too often, tips into sudden spirals that makes ones dreams of a resetting of the money systems of the world, not to mention personal wealth, go up in smoke.
Go on Reddit on any given day and you’ll find people asking why the price of Bitcoin is moving up or down, and all too often the answer is a snarky ‘people buying, people selling.’ True, and unhelpful. Read any of the slew of technical analyses available from Bitcoin news sites, and most of it reads like tea leaves. It’s my sneaking suspicion that most of the tools the financial analysts use in making these predictions may work well for very large markets, but fail in a small market like Bitcoins simply because the action of a single large-holder to buy or sell can trigger ripple effects across the exchanges.
And that, sadly, continues to be the truth of Bitcoin. 11 or 12 billion market cap might seem big to an individual, but it is tiny in comparison to the companies listed on the NYSE. All of Bitcoin could technically be bought by a single rich investor. Bitcoin is small, and it’s price up or down several†hundred dollars will not really matter to its future as long as development continues to be made on the code and the infrastructure – †both of which are happening. Not always smoothly, or prettily, but they are indeed happening.
And that is why I continue to be a holder and believer in Bitcoin.
Long term, it’s my belief that Bitcoin is going to be a safety net that will catch many, and perhaps even be the savior of whole societies, when the next financial crash happens. If one reads ZeroHedge, that crash is always going to happen tomorrow. But, the fact of the matter is that we are dealing with very large and complicated systems, and no matter how much they wobble, you can never really tell just when they’re going to fall over. The one certainty is that they are going to fall. The weaknesses and corruption of the systems tell us as much.
However, if Bitcoin is really going to be able to act as that safety net, it needs to be bigger or it too will be crushed by the crash. Bitcoin needs to grow. Whether that be the population of a country like China, Argentina, or Ghana piling in, or perhaps institutional investors suddenly saying ‘we need to have just a few bitcoins just in case,’ we need a catalyst to bring Bitcoin to the next level.
It’s for that reason that I hope Trace is right. If the limiting of the production of Bitcoins causes a supply/demand rise in price, that might also cause more people to start taking notice and buying in. If that happens, the price of Bitcoin will not merely rise to 4,000 by the end of 2017,†it will be big enough so ‘when the big one hits’ it will suddenly cease to be a digital curiosity and simply become ‘money.’