A group of friends asked: What is the basis for Bitcoin's market capitalization to rise to 3.3 trillion dollars?
Author: Zhu Weisha
Answering questions from friends: What is the basis for Bitcoin's rise to 3.3 trillion dollars?
Bitcoin's new inflection point
Yesterday, I used “How high can Bitcoin rise after the US approves the ETF?” This article answered a group of friends' questions: What is the impact of Bitcoin ETF funds on Bitcoin's trend? Overall, ETFs have fundamentally changed the status of Bitcoin and are the third inflection point in Bitcoin's history. Bitcoin's first inflection point was when the flatbread Glassow used 10,000 bitcoins to buy two pizzas, completing Bitcoin's thrilling jump from air to commodity. The second time was the first time Bitcoin was traded on the Mentougou Exchange, completing a historic leap forward for Bitcoin as a trading medium. Bitcoin's opening price increased 100 times in just 4 months. Why is the ETF an inflection point for the third time in history? Bitcoin ETF approval means that Bitcoin is recognized by mainstream capital systems. Despite being a belated benefit, and even though I don't like Gary Gensler's whining, the US Securities Regulatory Commission and he himself will forever go down in the history of Bitcoin development because they push humanity on the right financial path. This is a major long-term benefit that affects the fate of humankind. Benefits are divided into long-term benefits and short-term benefits. The impact of long-term benefits is calculated on an annual basis. It wasn't a year, nor two. It completely changed Bitcoin's development trajectory. Bitcoin left the small pond, jumped at the dragon gate, and the dragon returned to the sea.
Next, I further answered the group and read “How high can Bitcoin rise after the US approves the ETF?” Question:
“Can you explain it more clearly, when is the lowest point, how much is it, when is the highest point, how long is a cycle, and what is the basis for predicting Bitcoin's $3.3 trillion market value?”
ETFs play a decisive role in Bitcoin's rise
The volume of ETF funds played a decisive role in Bitcoin's rise. Bitcoin will depend on Wall Street's face for quite some time. “How high can Bitcoin rise after the US approves the ETF?” This article introduced the factors and basis for Bitcoin's rise; I won't go into detail in this article.
Bitcoin is halved every four years. Every time it is halved, supply is reduced by half. Under the condition that demand remains unchanged, it will inevitably rise. The lowest point of the current cycle was $16,000, which occurred in December 2022. Some people have summarized the cyclical effect of Bitcoin's 10-fold increase. Based on this, it is deduced that the high point is 160,000 US dollars, which is 8 times the difference between the high point and the low point of the previous cycle. Bitcoin generally has been in a bull market for more than a year, and a bear market for more than two years. A few months before the halving started, reached a high point six months to eight months after the halving, and then a bear market. None of these experiences were valid in front of ETFs. I wrote an article in the past predicting that I wouldn't even be able to get past 69,000 without an ETF. Demand is different now. ETFs have similar characteristics to bonds. The market capital is about 200 trillion dollars, and 1% of the capital goes into Bitcoin, and it explodes. Mainstream market capital has only been in 40 days. The trend is still undetectable, and the immortals can't predict it.
All Bitcoin operation experience is unreliable
ETFs are fundamentally changing Bitcoin's technical trend. The original experience will have to be revised again. There will definitely be a big rise, not necessarily a sharp drop, because your opponent is a Wall Street preacher. Big fish eats small fish is the same logic in the capital market. If you can't see the future trend clearly, holding the coins unchanged is the best strategy.
If one were to make a hard guess, it must be assumed that, based on data from the previous 40 days, ETF inflows remained constant. The average inflow of ETFs was 800 million dollars per day and 292 billion dollars a year, while stablecoin inflows were 29.2 billion yuan. The sum of the two was 31.2 billion dollars, and it was halved in less than three months. That is, assuming 30% of the total turnover, 321.2 billion dollars can leverage the market value of 1 trillion dollars. The currency price at this time was over 100,000 US dollars, which is a conservative estimate. Bitcoin halved in the previous cycle, and without the support of this round of 10-fold capital, it still increased 8 times. Therefore, this round of 10-fold effects should occur, and it will surpass, long-term favorable decisions, and rise to the point where you don't believe it. Will it keep going up?
The basis for rising to 3.3 trillion
Simply put, Bitcoin's market value of 3.3 trillion dollars is calculated based on the unit price of Bitcoin of 160,000 US dollars multiplied by 21 million bitcoins. As mentioned earlier, ETFs are a long-term benefit. After Bitcoin was speculated in the past, due to subsequent capital not being able to keep up, it will inevitably fall down to digest the speculation bubble, and slowly rise from the bottom. This time, the inflow of ETF funds in the previous 40 days was 10 times that of USDT; a simple estimate is that it is 10 times more digestible. ETFs, in particular, are beneficial for the long term. They will change Bitcoin's original bull-bear time ratio. The bull market is not peaking; Bitcoin is not peaking. How long has this crazy bull been? This is for us to judge. How to judge? We also need to go back to the main funding analysis. As soon as Wall Street took action, the original Bitcoin trading giants all became small prawns. In their opinion, the main capital determines the timing of the upward cycle and will determine the top of Bitcoin. The main capital believes that Bitcoin is a stored value asset. As the second-largest stored value asset that Bitcoin can occupy, it is a reasonable estimate; it is unimaginable to replace gold. Once in second place, there will be disagreements on Wall Street. At this point, Bitcoin's top stage will appear. At this point, the market value of Bitcoin was around 3.3 trillion dollars, which matched its position as the second-largest stored value.
In just two days, the price of Bitcoin soared from 52000 USDT to a maximum of 64,000 USDT, an increase of 10,000 US dollars. Meanwhile, Bitcoin's market capitalization reached $1.225 trillion, which is close to the market value of silver ($1.277 trillion).
How to get returns comparable to Bitcoin in the current year
If Bitcoin rises again, surpassing gold, it will require a new narrative and further innovation. It needs to be linked to everyday payments, that is, it will require Bitcoin-based implementation to achieve Halfini's conjecture: 10 million dollars per Bitcoin. This idea took shape in 2023. Bitcoin is based on the idea of a two-track monetary system. The meaning is the parallel competitive development of the fiat currency standard and Bitcoin standard. For the principles of Bitcoin standard, see the “Implementation of DW20 Decentralized Basic Coin” on the Chainless.hk website (chainless.hk). Simply put, add a yardstick to Bitcoin, use Bitcoin to measure global economic development, and use DW20 to replace stablecoins for everyday transactions. Together, Bitcoin and DW20 form an inflation-free Bitcoin standard system. However, the distribution principle of DW20 is the same as Bitcoin, and it also requires a process from air to asset coins (stablecoins). The difference is that DW20 uses an unconditional airdrop method, and anyone can register and receive certification at no cost. The air-to-asset process is a profiteering process, comparable to the huge wealth of Bitcoin mining in the early years.
DW20 is on the Bitcoin bandwagon, helping Bitcoin. DW20 is like Bitcoin in the early days. It is only easy to profit in the early stages. The sooner you register, the more likely it is to cross the hierarchy. Download link:https://eco.chainless.top/download?code=8613510870809VJYou will receive a big red envelope that will increase, possibly to tens of thousands of yuan.
