What will happen in the cryptocurrency world if it goes from $100,000 to $200,000?
Author: Zhou Zhou, Foresight News
Bitcoin has broken through $100,000, and this may just be the starting point.
Over the past year, BTC has more than doubled in value; over the past three years, BTC has risen nearly 6-fold; over the past five years, BTC has risen nearly 20-fold; over the past ten years, BTC has risen 500-fold, and over the past fifteen years, that is, since the day of the Bitcoin pizza, BTC has risen 40 million-fold... In sixteen years, Bitcoin has always been at a new starting point.
During these sixteen years, Bitcoin has been suppressed by governments around the world and then gradually accepted and even openly supported by them, questioned by the public and then held by more and more people. In 2024, the number of users of the cryptocurrency exchange Binance alone will exceed 210 million. Each time, people think Bitcoin has reached its peak and is about to reach its end, but each time it is proven to be just a new starting point.
The narrative and meaning of Bitcoin itself are also evolving, and people's views on Bitcoin are also changing.
Fifteen years ago, it was just a small experiment for cryptographers, a programmer in Florida, USA, used 10,000 bitcoins to buy two pizzas; ten years ago, it was just a payment method for illegal transactions such as gambling, drugs, and money laundering, and most of its use cases were illegal transactions; five years ago, it and the cryptocurrency industry gradually grew into a brand new financial system, which is not accurately described by the word "crypto Nasdaq" (Ethereum), "crypto banks" (Tether, Ethena), "crypto securities firms" (Binance), account systems (Metamask)... Each product has tens of millions or even hundreds of millions of users, and it has almost all the infrastructure and products of the traditional financial industry, but more efficient, more streamlined, more transparent, more decentralized and globalized; three years ago, the cryptocurrency industry is no longer limited to the financial scenario, but has expanded to the Web3 application scenario, so the next-generation financial system + the next-generation Internet system has become its new mission.
Now, more people believe that Bitcoin is gold. Bitcoin's market capitalization has reached $2 trillion, already exceeding the market capitalization of silver and one-tenth of the market capitalization of gold. Bitcoin has been recognized and supported by sovereign countries such as the United States and Japan. And this process, Bitcoin has only taken sixteen years. Even more astonishing is that the blockchain technology behind Bitcoin has also spawned a whole new financial ecosystem and Internet ecosystem, and the thousands or even tens of thousands of cryptocurrency institutions in these two ecosystems are in turn driving the popularization of Bitcoin, making it possible for Bitcoin to truly become a global currency.
And when Bitcoin reaches the $100,000 mark, everyone is asking a common question: Is Bitcoin nearing its endpoint? How far is Bitcoin from its endpoint? Will Bitcoin have a new narrative?
5 billion internet users have not yet touched Bitcoin
$100,000, is still the starting point of Bitcoin, and this time Bitcoin will welcome new "buyers".
The biggest new buyers this year are undoubtedly BlackRock, the world's largest fund, and the main buyers behind BlackRock and other funds - American companies and institutions.
In January 2024, the United States passed the BTC ETF, which means that U.S. listed companies, pension funds, BlackRock funds, Stanford University funds and other institutions can publicly purchase and hold Bitcoin through ETFs issued by BlackRock and other funds. The approval of the U.S. Bitcoin ETF has triggered a wave of large U.S. institutions buying Bitcoin, with global large companies rushing to the scene to buy Bitcoin, and $100 billion flowing into BTC ETFs in 10 months, with hundreds of billions of dollars being bought through U.S. fund companies every month.
Bitcoin has also soared from over $40,000 to $100,000, largely due to the approval of the U.S. BTC ETF, which has allowed U.S. institutions to also buy Bitcoin through the legal channel of ETFs. The approval of the U.S. BTC ETF and the data performance of the following 10 months have already become a miracle in the history of ETFs.
And if Bitcoin goes from $100,000 to $200,000, what new buyers will rush in?
First, from an institutional perspective, the institutions currently buying Bitcoin are still mainly from the United States, and the U.S. Bitcoin spot ETF is still rapidly attracting capital inflows at a rate of hundreds of billions of dollars per month, with no signs of stopping, and U.S. and global companies and institutions will continue to buy Bitcoin through Bitcoin spot ETFs.
Globally, Japan, Europe, China and other major economies have not yet fully lifted restrictions on institutional purchases, and once the major economies lift the restrictions, it will be another leap. And according to the famous "time machine theory", innovative assets and mechanisms often spread from the United States to developed countries, and then to developing countries. Whether it is in the asset and finance field: gold, Nasdaq listing mechanism, SPAC listing mechanism, or in the broader technology field: the Internet, chips, mobile phones, new energy vehicles, they often follow the time machine theory.
Secondly, from the perspective of the general public, the penetration rate of Bitcoin is still far from enough. According to estimates by the well-known Silicon Valley investment firm a16z through various methods, the current global monthly active cryptocurrency users are about 30-60 million. Even if this range is expanded to include users who have held cryptocurrency, according to Crypto.com's analysis in April 2024, the global cryptocurrency users are 610 million. While the world's population is 8.2 billion, with about 5.4 billion Internet users, there are about 5 billion Internet users who have not yet experienced cryptocurrency products.
The cryptocurrency industry hopes to form a new global financial system and Internet system, so that everyone can use cryptocurrency products like Internet products. In 2024, there are 5.4 billion Internet users, but only 610 million cryptocurrency users, with a huge incremental market. And the cryptocurrency industry is changing this situation, it is changing the financial system and the Internet system.
And when the cryptocurrency industry becomes as widespread as the current Internet industry, Bitcoin will reach the population of now times ten.
Finally, there is another key buyer: sovereign states.
After El Salvador, Bitcoin is likely to become the reserve asset of more and more sovereign states. Especially after Trump was elected President of the United States, China, the United States, Japan, Europe, the United Arab Emirates and other major economies are likely to accelerate the inclusion of Bitcoin as a national reserve asset, which will allow Bitcoin to take another leap.
Major countries personally entering the Bitcoin purchase is not just a rumor. On November 22, according to a Reuters report, Trump's "Cryptocurrency Advisory Council" is expected to establish the promised Bitcoin reserve.
Trump has publicly supported Bitcoin and the cryptocurrency industry on many occasions. During the campaign, Trump promised a number of measures to support the cryptocurrency industry, such as including Bitcoin in the national reserve, making the United States the world's cryptocurrency capital, and relaxing regulations, etc. Trump's proposal has received the support of some political and industry experts, for example, U.S. Senator Cynthia Lummis has already proposed a bill to establish a Bitcoin strategic reserve, with the goal of acquiring 1 million BTC within five years and holding it for at least 20 years to hedge against U.S. national debt.
And when the United States makes Bitcoin a reserve, most countries are also likely to allocate a corresponding proportion of Bitcoin assets, just like gold.
In summary, whether it is the 5 billion Internet users, or the $10 billion per month of mainly institutionally bought Bitcoin spot ETFs, or sovereign wealth funds, they will all be potential buyers of Bitcoin, and the key "buyers" for Bitcoin to rise from $100,000 to $200,000.
$100,000, is just the beginning
$100,000, is just the starting point of Bitcoin. If Bitcoin wants to rise from $100,000 to $200,000, it not only needs new buyers, but also a new batch of believers and builders to expand Bitcoin's reach.
And cryptocurrency practitioners may be one of the most exploratory groups in the world.
They need to understand not only the development of various blockchain technologies such as ZK, but also the new technological trends in industries such as AI, VR, and the metaverse; they need to have an in-depth understanding of US politics and elections, the timing and magnitude of the Federal Reserve's interest rate cuts, and the cryptocurrency policies of Hong Kong and Singapore, and they also need to closely monitor various macroeconomic events such as wars, economic crises, and stock market fluctuations; they need to understand the differences between public chains such as Bitcoin, Ethereum, Solana, Sui, and Base, and they also need to be familiar with concepts and tracks such as Web3 social, Web3 gaming, DeFi, and Non-Fungible Token.
From ICO, to DeFi, to Non-Fungible Token, and now to Mass Adoption, crypto practitioners are constantly expanding the boundaries of blockchain networks, so that crypto assets such as Bitcoin can truly circulate globally and generate value.
Many people ask, what is the meaning of Bitcoin and cryptocurrencies? Why are so many people joining the cryptocurrency industry?
I often answer that when the value of Argentina's national currency shrinks by more than 50% every year, companies like Binance and Tether provide stablecoins to protect Argentinians' assets from shrinking significantly, this is the meaning of Bitcoin's existence; when people want to transfer money to their transnational family and friends, but the traditional economic and political system has set up layer upon layer of obstacles, not only requiring high fees but also requiring a very long waiting time, this is the meaning of Bitcoin's existence; when, as a startup founder, it is difficult to collaborate directly with employees in different currencies and different systems in several or even dozens of countries at low cost under the existing system, this is the meaning of Bitcoin, cryptocurrencies and blockchain.
Bitcoin has created value, and is constantly exploring the possibility of creating new value, from building a new financial system to building a new Internet system, this path has only completed a small part, and the new builders still have a long way to go.
$100,000 is just the starting point for Bitcoin.
