Bitcoin has had a meticulous year, no doubt about it. At its current prices of $7300, many investors feel like the opportunity to profit from Bitcoin has passed. It’s quite normal to feel that way given that at its current valuations, the price is a bit high. But if you missed the chance to buy Bitcoin when it was below $1000, don’t worry because it is still early days. Bitcoin could rise even further. Some experts even believe that Bitcoin could go as high as $100k in the next two decades. If you don’t believe it, let’s look at 4 reasons why Bitcoin could shoot above $20k within the next few years.
4 reasons why Bitcoin could shoot above $20,000 in a few years
Bitcoin supply is capped
One of the fundamental laws of economics is the law of demand and supply. When the demand for a commodity is higher than its supply, prices rise. Now put this in the context of Bitcoin. Bitcoin has a capped supply of 21 million coins. As Bitcoin’s demand rises against this fixed supply, its prices will continue to rise. This is one of the reasons why Bitcoin will be continue to rise and hit even crazier valuations than the ones it is trading at currently.
There is no valuation criteria
If you have ever invested in stocks, then you know that a company can be overpriced or underpriced either based on earnings, or its assets. These factors do not apply to Bitcoin. In fact, its current value is based on nothing but a perception of value. There is a likelihood that Bitcoin will continue to ride this perception and grow. That’s because, inherent weaknesses in fiat currencies are making people lose confidence in fiat currency as a store of value. Now imagine how much it will be worth, once a sizeable portion of the world population develop the perception that Bitcoin is a better store of value than fiat currency. Its prices could even shoot to a $ 1 million.
Bitcoin is the global currency of the 21
For some time now, economists have been looking for a global currency that is more in tune with the needs of 21st century global finance. Bitcoin is shaping up as the currency that could take that role in the long run. Take for example countries like Zimbabwe and Venezuela where local currencies have collapsed. Bitcoin has taken over the role of asset transfer as well as value determinant in these nations. If this trend continues as it most likely will, Bitcoin’s value will grow, and this could push it to prices that you may not imagine today.
It cannot be cornered by a few industry players
It is no secret that bankers are some of the most hated people in the world. They are viewed as greedy and responsible for many of the financial woes facing the world. That’s because bankers have gamed the fiat currency system, and can manipulate it as they please. Bitcoin does not have this weakness. It is so decentralized that it would be impossible for anyone to control it. This aspect of bitcoin is part of what has endeared it to many in the world. As more people get into Bitcoin based on this aspect of it, its demand will grow; pushing its price to $20,000 and beyond. There is no limit as to how far bitcoin can go.