As the cryptocurrency market continues to evolve, opinions on its future trajectory are as diverse as they are numerous. Recently, Michael Saylor, CEO of MicroStrategy, made a bold statement regarding Bitcoin’s growth prospects over the next 21 years. In this article, we will delve into the details of his prediction and compare it with our own model, known as the "Rate of Adoption" model.
Michael Saylor’s Prediction
According to Michael Saylor, Bitcoin’s price is expected to grow at an average annual interest rate of 29% over the next 21 years. By 2045, he predicts that Bitcoin will be worth $13 million in his best-case scenario. As he himself put it, "Every Bitcoin you don’t buy is gonna cost you $13 million, my friend."
This statement is certainly attention-grabbing and warrants careful analysis to determine its validity.
The Rate of Adoption Model
Those who have followed me are familiar with the "Rate of Adoption" model. This model correlates Bitcoin’s price to the growth rate of "non-zero" wallets, which are wallets containing at least a fraction of Bitcoin. I first presented this model in February 2020 at the Quant Workshop Conference, organized by Diaman Partners Ltd.
The model predicted the 2021 peak at $63,000, slightly below the all-time high of $67,000 in October 2021. In 2023, I updated the model and published the results in Cointelegraph. The prediction for the current cycle was $130,000, a price Bitcoin will soon reach.
With the approval of Bitcoin ETFs in the United States and 11 companies simultaneously promoting such an instrument, it’s clear that the parameters have changed. I had planned to recalculate the model in autumn 2024, and here we are.
Recalculating the Model
With the recalibrated model, I am ready to estimate Bitcoin’s price in 2025 before it likely enters the next crypto winter in the autumn and winter of 2025. Let’s compare Saylor’s projection with our model before giving a short-term prediction.
He predicts an average annual return over the next 21 years, while our model uses a more sophisticated power law. This approach relates the average price per wallet to the number of non-zero wallets in circulation. The multiplication of these variables provides the expected market capitalization of Bitcoin, from which it’s easy to derive the price.
Our Model vs. Saylor’s Prediction
The chart below illustrates our calculations and predictions for Bitcoin’s price over the next few years:
| Year | Predicted Price |
| — | — |
| 2025 | $261,000 |
| 2045 (median) | $8.3 million |
| 2045 (upper bound) | $21.6 million |
As illustrated in the chart, our calculations indicate that by 2045, Bitcoin’s price could reach $8.3 million on the median curve. On the higher curve, driven by the semi-exponential surge marking the end of each bullish cycle, it could exceed $21.6 million.
It is key to remain aware of Bitcoin’s potential trajectory, as the market is filled with individuals who settled for gains of +60% or +100%, only to exit too early and miss out on subsequent, extraordinary price increases.
Holding onto Bitcoin
I’m not suggesting holding Bitcoin indefinitely, as Saylor advocates. Still, it should undoubtedly be held for as many years as possible, or at least until it becomes clear that it will be replaced by something more attractive and functional (which, as of today, does not exist).
Conclusion
In conclusion, while Michael Saylor’s prediction is certainly bold and attention-grabbing, our own model indicates a different trajectory for Bitcoin’s price. With the approval of Bitcoin ETFs and increased adoption driven by these instruments, our 2025 forecast for Bitcoin’s peak price is $261,000, nearly double the previous estimate.
Of course, there are no guarantees that these values will materialize, nor should this be considered investment advice. I always recommend conducting thorough research and analysis before making any investment decisions, ideally with a qualified financial adviser who can guide you on the appropriate allocation within your portfolio.
It is crucial to understand the dynamics and potential of Bitcoin thoroughly. Otherwise, it may always seem too expensive to buy.
Insightful Phrase
I’ll leave you with an insightful phrase that I believe sums up the current state of the cryptocurrency market: "Every Bitcoin you don’t buy is gonna cost you $13 million, my friend."
This statement highlights the importance of staying informed and making educated investment decisions in the ever-evolving world of cryptocurrencies.
Final Thoughts
In conclusion, while Michael Saylor’s prediction is certainly attention-grabbing, our own model indicates a different trajectory for Bitcoin’s price. With increased adoption driven by Bitcoin ETFs, we believe that Bitcoin has significant potential for growth over the next few years.
As always, it’s essential to conduct thorough research and analysis before making any investment decisions. Stay informed, stay educated, and above all, stay vigilant in this ever-changing market.
Recommended Reading
- The Future of Cryptocurrency: A Comprehensive Guide
- Bitcoin’s Price Trajectory: What to Expect in the Next Few Years
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