From CCN.com: During the bull run in the cryptic market in 2017, bitcoin price forecasts have kept the cryptic and happy grit. That was the eccentric ICO promoter John McAfee who promised to rob himself if Bitcoin could not reach $ 1 million within three years or Fundstrat setting a "conservative" price target at $ 25,000, each cryptor influencer had a goal of price – and most represented a significant rise, often in the very short term.
Increasingly, however, bitcoin price targets so optimistic – and specific – look like a relic of a bygone era. Even Tom Lee, perhaps the biggest bull crypto on Wall Street, has abandoned the bitcoin price forecasting game, complaining that the market failed to recognize that the true value of the asset was far above the current level.
Lucid: the global debt crisis creates great opportunities for Bitcoin
In this bearish context, the asset management company Lucid Investment Strategies is moving away from the package to make a phone call that sounds like a return to 2017: The price of bitcoin could one day reach $ 10 million, become the new gold standard and solve the global debt crisis.
According to Lucid, the relationship between global debt and wealth has lost control, creating a "grotesque imbalance" of wealth inequality. At the end of 2018, total world debt was estimated at $ 247 trillion, compared to $ 317 trillion in total world wealth. But while global wealth continues to outweigh the debt, the gap is rapidly closing; In the last 20 years, debt has increased by 394%, while wealth has risen by just 133%.
Writing in a new report, Lucid states that this status quo is not sustainable and that the world economy must ultimately find a solution to tackle the debt crisis. The five most likely strategies, says the company, are the adoption of a gold standard, the creation of a new basket of commodities / currencies, economic growth, absolute default on sovereign debt or mass investments in bitcoins. .
Although perhaps not the most likely result, the company claims that bitcoin is the best alternative as it would provide a "permanent correction" to the debt crisis, limiting the damage that will inevitably accompany the widespread economic upheavals.
From the report, which was written by President Lucid and Chief Investment Officer Dean Tyler Jenks and Executive Vice President Leah Wald:
[I]s this [mass bitcoin adoption] doable? Probably not. But we believe it is possible and we believe it offers the greatest benefits with the minimum collateral damage to the smallest number of individuals, companies, institutions and countries. Above all, it would provide a permanent correction, a quality that none of the other solutions provide.
If this happened, the price of the bitcoin would inevitably enter the stratosphere. But how high could it go? Lucid says that $ 10 million is a good estimate.
Why $ 10 million? At that level, Bitcoin would provide sufficient reserve to alleviate the global debt burden. Bitcoin would range between $ 180 trillion and $ 210 trillion (depending on when that price was reached). Assuming that the world debt had reached 500 trillion dollars at that time, remember that it has grown by 394% over the last 20 years, Bitcoin would represent a 40% reserve against debt.
How the Bitcoin price could reach $ 10 million
From there, the report examines what kind of bitcoin route it should have taken to reach the $ 10 million mark from where it is today, kneeling in a 13-month bear market and languishing near the $ 3,500 mark.
The first step, of course, is coming out of that collapse. Unfortunately, this could happen later than before. Like many analysts, Lucid believes that the price of bitcoin has not yet hit the bottom, indeed, indeed, but it will probably be below the $ 1,000 threshold before the course explodes.
Exposing Altcoin as a cheap Knockoff
An important trigger for establishing a fund will be the "total decimation" of the altcoin token tokens (ICO), which will prove once and for all that bitcoin is digital gold, and its so-called competitors are only economic knockoffs.
The next big step on this journey will be the total decimation of altcoins, ICOs and the realization of the important attributes of Bitcoin. That process started, but the regulators have to regulate. We believe that they will do it. During this period, Bitcoin will continue to lose value, but at a much slower pace than its competitors.
With the bottom in and no more absurdity about "building a better bitcoin", the top cryptocurrency would have started grinding to the top. After tackling the initial resistance, the price of the bitcoin will begin to speed up its rise as it breaks through the main technical hurdles towards creating a new high of around $ 20,000.
Replace gold as the Premier Store of Value
The next big Bitcoin challenge would have come to $ 100,000, the brand with which he would start competing with gold as the world's leading economic cover. If investors start selling gold for bitcoins, the cryptocurrency could quickly eclipse the yellow metal. Otherwise, the route would be slower, although still possible.
Downsizing, institutional adoption and regulatory clarity
In particular, it is also here that Lucid believes that developers must begin to keep promises to scale the cryptocurrency protocol to accommodate a much more crowded network. Downsizing, combined with institutional adoption and regulatory clarity, would put bitcoins on the right path to becoming not just a store of value, but the reserve currency of the world.
"This has been accomplished, the road for $ 1 million will be smooth and straightened.The damage will be $ 1 million both psychologically and financially," write Jenks and Wald. "At $ 1 million, Bitcoin will have a market capitalization of $ 18 trillion – it will be in the main set of asset classes and wealth pockets – it will be a contender."
As the fastest growing asset class in the history of the world, it will no longer be ignored by pension funds, sovereign wealth funds, institutional monetary managers, funds, financial institutions and even governments. These will fuel the journey, at high speeds up to $ 10 million.
When Bitcoin prices, ask the right question
Once again, Lucid has recognized that this mental experiment is unlikely to manifest itself in the real economy. However, they support it he could it happens, and if it could happen, then why would bitcoin bulls not bet that they will, even if only to a much lesser extent?
"We believe that Bitcoin will be chosen [as the solution to the debt crisis]? This is the wrong question, "said Jenks and Wald as they concluded the report." The right question is: will there be a choice? Alternatively, will the resolution of the economic strength of the imbalance be likely to be predefined? "
Close-up image of Shutterstock. Price charts from TradingView.