
If we assume bitcoin continues following its long established price trend for 26 more years, bitcoin will be worth $21M per coin in the year 2051. That would be an average annual compound growth rate of 22.3%, but most of that will be front loaded… If one assumes this really does happen, what would one rationally pay today for a bitcoin that will be worth $21M in 2051? Well, we need to assume a risk free rate. Let’s try 2%, 4%, 7%, and 13% RFR 2%, bitcoin would be $12.5M RFR 4%, bitcoin would be $7.6M RFR 7%, bitcoin would be $3.6M RFR 13%, bitcoin would be $875,000 With 30-year treasuries at 4.821%, one bitcoin today would be wisely bought at or below $6.17M assuming future bitcoin price of $21M in the year 2051. Thus we conclude market assigns a 1.84% chance of bitcoin reaching this price (Current price divided by fair present value)…1 in 54 ain’t bad odds, but I think the market has it all wrong.