Bitcoin Price Could Reach $52 Million By 2050 According To VanEck
By: Eva Baxter
In a groundbreaking analysis, VanEck, a leading investment firm, forecasted that Bitcoin's price might skyrocket to a staggering $52.38 million per coin by 2050. This forecast comes from a detailed report conducted by VanEck’s digital assets research team led by analysts Matthew Sigel and Patrick Bush. The report titled “Bitcoin 2050 Valuation Scenarios: Global Medium of Exchange and Reserve Asset” delves into Bitcoin’s potential role in the global financial system over the next few decades.
The analysts elaborate that Bitcoin's potential path to such a massive valuation lies in its transformation into a primary reserve currency. “By 2050, we see Bitcoin solidifying its position as a key international medium of exchange, ultimately becoming one of the world’s reserve currencies,” they explain. This forecast is underpinned by the anticipation of declining trust in traditional reserve assets due to the unsustainable fiscal policies and geopolitical issues of today's economic leaders.
Emerging Layer-2 solutions are expected to play a pivotal role in resolving Bitcoin's scalability challenges, enhancing its functionality, and increasing its attractiveness in the financial systems of developing nations. Sigel and Bush argue that the combination of Bitcoin's immutable property rights and sound money principles with Layer-2 solutions could create a global financial system that better meets the needs of the developing world.
Within their analysis, VanEck highlights the diminishing significance of key currencies such as USD, EUR, JPY, and GBP in global trade. Their collective share of cross-border payments is projected to drop from 86% in 2023 to 64% by 2050. This shift opens significant opportunities for Bitcoin to emerge as an essential alternative for settling international trade.
VanEck outlines two primary scenarios, a base case, and a bull case, for Bitcoin’s future valuation. In the base case, Bitcoin is envisaged to attain a value of $2.9 million per coin by 2050, with its role in settling a portion of global trade and a substantive allocation as a central bank reserve. This scenario anticipates central banks holding 2.5% of their assets in BTC, contributing to a total market cap of $61 trillion.
The bull case scenario showcases an even more optimistic view where Bitcoin could integrate profoundly within the global economy. In this scenario, Bitcoin could settle 20% of global international trade and 10% of domestic trade volumes by 2050, representing 29.79% of global financial assets. Astonishingly, this would imply nearly 99% of Bitcoin’s supply being held as a store of value, leaving only about 210,000 BTC in active circulation.
Despite current limitations in Bitcoin’s ability to function as a medium for international trade, particularly relating to transaction processing capacity and support for complex smart contracts, VanEck remains optimistic. The ongoing development in Bitcoin’s infrastructure, especially through Layer-2 solutions, is expected to progressively enhance its functionality and appeal.
Concluding their analysis, VanEck envisions Bitcoin not just as a financial tool but as a transformative economic force that redefines money in a global context. They regard Bitcoin as a potential constitutional constraint on money, created by the people and for the people, potentially serving as the ultimate check against the often arbitrary financial powers of the state.
As of the latest updates, Bitcoin is trading at $64,210 per coin, reflecting the market's ongoing interest and confidence in its future potential.
