The Total Market Capitalization of Bitcoin
The first implication is completely price related. A $500k bitcoin would mean that in total, all the bitcoin in circulation would be worth 10.5 trillion dollars. Anthony Pompliano, a prominent bitcoiner thinks that this is a realistic proposition. Pomp thinks that bitcoin could surpass the market capitalization of gold by the end of the decade. Right now, all of the gold in the world is worth about $10 trillion dollars. So one of the things that a $500k bitcoin would mean, is that it has become as large of an asset as gold itself. There is a prevailing narrative in the crypto space that bitcoin is digital gold, or gold 2.0. This narrative is supported by the characteristics of bitcoin, and its similarities to gold.
This narrative may in fact be grounded in financial models that analyze the stock of bitcoin, to its flow in the market. When examining this bitcoin chart, bitcoin starts to look a lot like gold. Bitcoin is following a trend similar to gold. In fact, according to this model, Anthony Pompliano has made a really safe bet. We might actually see a $500k bitcoin by around 2025, instead of by 2029.
Satoshi Nakamoto Will Be the Richest Person in the World
Assuming Satoshi is a single person, a $500k bitcoin would make Satoshi the richest person in the world. Satoshi’s fortune amounts to about 1 million bitcoin. Satoshi would therefore have $500 billion dollars worth of bitcoin in the event that bitcoin reaches $500k. This would make Satoshi the richest person on the planet. Although Jeff Bezos is not far behind, having just reached a net worth of $200 billion. The difference between the two is that the identity of Satoshi is unknown, and they’ve never touched their wealth, for anything. Bezos on the other hand is constantly in the public spotlight for his wealth. Will there perhaps be a call on Satoshi to their wealth to improve the state of the world like there is for Jeff? Will Satoshi begin to be demonized for their greediness? Probably.
Perhaps Satoshi’s “greed” is properly reconceptualized as aiding in the adoption of bitcoin. If Satoshi were to flood the markets and liquidate their holdings, this would surely cause a crash in the price of bitcoin. Therefore what Satoshi is doing, is voluntarily withholding their coins from circulation to aid in making bitcoin all the more scarce. Or maybe Satoshi is just waiting for the day that Bitcoin reaches $500k before they liquidate their holdings.
Satoshi Stackers get Rich when Bitcoin hits $500k
We’ve all heard stories of young, tech savvy college students mining bitcoin in their college dorms in 2011. There was once a time when bitcoin could be mined on the CPU of a basic laptop computer, although this is no longer the case. The individuals that did do this, are now crypto rich. At least some of them are. There are stories of those who threw away their old harddrives because they simply didn’t think that the bitcoins sitting on the drives would be worth anything. Now the trend is to “Stack Sats”, which is short for stack Satoshi’s. This of course is an homage to the smallest unit of Bitcoin, Satoshi’s. This now viral meme is essentially investment advice to all the early bitcoiners out there. There are a swath of applications that make it super simple to accumulate Satoshi’s.
The individuals that are stacking will essentially be the next wave of Bitcoin millionaires. One thousand Satoshi’s is currently worth about $.12. But what happens when bitcoin rises to $500k per piece? Well suddenly those 1000 satoshis (.00001 bitcoin), becomes worth $5. There are some applications that give away several thousand Satoshi’s per day, simply by interacting with the application. ShakePay is one of them. Simply by logging into the app, and shaking your phone, ShakePay will award you with more and more Satoshi’s. If you’re a “Sat Stacker” then you’re shaking and staking all over the place. These Satoshi’s eventually add up, and if you’re accumulating every single day of the year, then you’re essentially working on your retirement plan.
Governments Would Surely Notice
At what point will governments actually decide to start taking deliberate and coordinated action against Bitcoin? One reasonable answer is when/if Bitcoin ever overtakes gold as an asset. In the 1930’s we saw America outlaw the ownership of gold in order to bolster their control over world currency markets. Outlawing bitcoin has been done by several countries already such as Russia, and India, only to be reversed later. Perhaps a more permanent and aggressive outlawing of Bitcoin is in order if Bitcoin were to grow to the size of gold. Although getting foreign governments to agree on any one thing is a fantastic achievement in itself. Getting them to take a coordinated action against Bitcoin is unlikely. Having that action actually make a lasting dent in the stability of bitcoin is even more unlikely.
What Will it Take to Get to $500k?
As of right now, bitcoin is worth about $12500 USD. If the price of bitcoin were to rise to $500k, this would be a 40x increase in the price of bitcoin, which all things considered, is not that much. Right now about 100 million people are using the bitcoin network. So what amount of people need to begin using and investing in the network in order to grow bitcoin to the size of the market cap of gold? Is it 4 billion people? Maybe it is simpler than that, and for every million users, the price doubles.
These answers are difficult to know or even come up with an educated guess for. One thing can be said with confidence. A world where bitcoin is worth $500k is a world where bitcoin has become accepted by many. It will be easy to acquire, save, and spend. The term bitcoin will be as recognizable as Nike, or Coca-Cola. Bitcoin will continue to receive billions of dollars worth of free advertising on a yearly basis.