Samson Mow, a prominent individual involved in the process of nation-state acceptance of Bitcoin and serving as the Chief Executive Officer of JAN3, has initiated a substantial discourse within the Bitcoin community. Mow, renowned for his contributions to the field of Bitcoin Bonds in the context of El Salvador, expressed a confident assertion on the social network X, suggesting the possibility of a substantial and swift increase in the value of BTC. The individual expressed that there exists a group of Bitcoin enthusiasts who hold the belief that Bitcoin's value cannot ascend to $1,000,000 over a short timeframe of days or weeks subsequent to the influx of funds from exchange-traded funds (ETFs). The individuals will experience a positive and unexpected outcome.
The value of one Bitcoin amounts to $1 million. Is the individual mentally stable?
Expanding upon his forecast, Mow alluded to the historical trajectory of BTC, noting that in 2017, it required around nine months for Bitcoin to surge from a valuation of $1,000 to $20,000. The block subsidy amounted to 12.5 units, a significant quantity of BTC was circulating inside exchanges, mining activities were causing substantial environmental impact, and there was a lack of institutional investment in the market. The range from $1,000 to $20,000 represents a twenty-fold increase. The range of $50,000 to $1,000,000 represents a twentyfold increase.
Bit Paine, a Bitcoin analyst, presented a quantitative analysis that substantiates Mow's forecast. Paine's study places significant emphasis on the expeditious rate at which the price of BTC might appreciate. Paine asserts that individuals who see Samson Mow's prediction of $1 million per BTC as irrational fail to acknowledge the swiftness with which Bitcoin can manifest, a mentality that is crucial for the realization of such an event.
Paine starts his comprehensive examination by delving into the foundational principles of supply and demand. The individual does calculations to determine the projected supply for the upcoming cycle. It is estimated that the present epoch will yield roughly 136,000 BTC, while the subsequent epoch is expected to produce around 656,000 BTC. Consequently, the total projected supply for these two epochs amounts to approximately 792,000 BTC.
Paine further contemplates the prospective liquidation of antiquated BTC, employing the HODL Waves measure as a basis. It is estimated that around 15-20% of the historical circulating supply may become available for sale, as shown in prior cycles. In a hypothetical situation, supposing that 20% of the existing Bitcoin (BTC) holdings were to be liquidated throughout the span of the following four years, the total quantity of BTC sold would approximate 3.8 million.
According to Paine, in order to attain a valuation of $1 million per BTC, it would necessitate a total financial infusion of nearly $4.5 trillion. The author identified two significant possible sources for this cash.
Initially, Paine drew attention to the aggregate value of retirement savings in the United States, which is estimated to be over $35 trillion. A modest redistribution of 5% of these accumulated funds towards Bitcoin would result in a substantial sum of $1.75 trillion. Additionally, the author examined the holdings of corporate treasuries in the United States, which amount to around $1 trillion. If a portion equivalent to 10% of the total amount under consideration were allocated towards Bitcoin (BTC) investment, it would result in an additional $100 billion being contributed to the market.
In addition to the aforementioned sources, Paine elucidated numerous other reasons that possess the potential to propel the price of BTC to the significant threshold of $1 million. The factors under consideration encompass the possibility of increased acceptance of Bitcoin by sovereign nations and the consequences of further currency issuance, with a specific focus on its impact on the extensive global bond market valued at $150 trillion throughout the upcoming five-year period.
Additionally, the speaker highlighted the potential for a decrease in the availability of older BTC being introduced into the market as a result of the unwavering commitment of present holders. The presence of an exceptional quantity of BTC held by long-term investors, who have a strong belief in the concept of Hyperbitcoinization, has the potential to reduce the anticipated 20% decline in the holding wave to 15% or even 10%.
According to the expert, potential drivers for the market include the collapse of other cryptocurrencies and a redirection of money towards Bitcoin. Additionally, the underperformance observed in the previous cycle may result in a delayed yet impactful market response. Finally, Paine observed the significance of technology progressions, shown by Taproot, in augmenting the attractiveness of Bitcoin.
