Bitcoin Market vs. Others Markets — Why Bitcoin’s Growth Potential Remains Phenomenal | by Sylvain Saurel | Oct, 2021

Sylvain Saurel

What Bitcoin has accomplished since its inception is nothing compared to what lies ahead for the future.

Illustration by Sylvain Saurel

March 2020, just before the start of the COVID-19 pandemic, I analyzed different scenarios for Bitcoin’s market cap in the future. At that time, Bitcoin’s market cap was much lower than it is today, at around $166 billion.

I compared Bitcoin’s market cap to that of other markets such as gold, stocks, and real estate:

Illustration by Sylvain Saurel

As I explained at the time, Bitcoin’s first target was the gold market cap. Bitcoin can play the role of a store of value in times of crisis as has been demonstrated since March 2020. Gold has played this role for centuries, but Bitcoin is slowly but surely catching up to gold in the hearts of investors.

Since March 2020, gold’s market cap has risen by +42%, while Bitcoin’s market cap has seen an increase of nearly +600%. In the face of great monetary inflation, gold is holding up well, but Bitcoin is largely outperforming.

While gold’s market cap was still 60 times that of Bitcoin in March 2020, it is now only 9.8 times. The gap has narrowed dramatically in just 18 months, and this trend is expected to continue in the coming months and years.

For Bitcoin, the primary goal over the next decade remains the same: to catch up with gold’s market cap. This represents a potential x10 increase over the current market cap.

If Bitcoin were to catch up with gold’s current market cap, that would give us a Bitcoin price of around $420K-$450K. The range is wide because it all depends on when this flippening takes place. Please note that I’m talking about when, not if, here. This is deliberate because I am convinced that this flippening will take place in the future.

Since March 2020, the global stock market has gone from $73T to $96T. An increase of +32%. This is even behind the market cap growth of gold, while the equity market is in the middle of a huge bubble that has pushed the valuations of many companies to record levels in America.

The ultra-accommodating monetary policies pursued by central banks since March 2020 have inflated the global money supply from $90T to just over $100T. This confirms the great monetary inflation we face as individuals. In order not to see our purchasing power collapse drastically, we have to invest to beat inflation.

We can see a very strong increase in the real estate market at the global level since the market cap has gone from $228T to $290T. Finally, global debt, which was already worrying before the pandemic, has exploded in eighteen months to now exceed $300T.

The trend is for a strong acceleration of public debt almost everywhere in the world, so that countries with a public debt to GDP ratio below 100% have become an exception.

America has the largest public debt in the world above $28T. $30T will probably be reached in the coming months, while the debt to GDP ratio is now over 130%.

All these figures are there to make you think. The price of Bitcoin around $60K at the time of writing suggests to some that they are too late to benefit from its revolution. Since the price of Bitcoin is divisible to eight decimal places, you should be aware that you can buy Bitcoin even for $1 if you want to.

A more relevant way to look at it is to look at the Bitcoin market cap.

That’s what I’ve done in this article, and that’s what should show you that we’re only at the beginning of the Bitcoin revolution. With a market cap of just over $1.15T, Bitcoin still has phenomenal growth potential for years to come.

If Bitcoin continues to progress through the 3 phases of adoption it is following, then it will go much further after surpassing gold’s market cap. Michael J. Saylor spoke of a $300T market cap as a potential target for the future. Without being as optimistic as the CEO of MicroStrategy, you can already envision the Bitcoin market reaching half of the current global equity market one day.

That would give a market cap of around $50T.

With a hard-capped Bitcoin supply of 21 million units no matter what, you could then envision a Bitcoin price of around $1.47M. So you can see that the $1M Bitcoin hypothesis that some people have been talking about from time to time is not something far-fetched.

It is still a distant goal, but who thought at the time of its creation that Bitcoin could reach a market cap of over $1T one day? Probably no one, except perhaps Hal Finney, who was talking about the scenario of a maximum Bitcoin price in the future of $10 million per coin:

Message from Hal Finney in January 2009

It was January 2009, and the Bitcoin blockchain had only been running for 8 days. That’s how far-sighted Hal Finney already was.

Whatever happens in the future with Bitcoin, only one thing is certain: we are only at the beginning of an incredible monetary revolution that has yet to surprise us.

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