Asset manager and cryptocurrency ETF issuer VanEck has published an ambitious research report predicting that Bitcoin (BTC) could reach a staggering price of $2.9 million per coin by 2050. The analysis, led by Matthew Sigel, VanEck's Head of Digital Assets Research, and Senior Investment Analyst Patrick Bush, employs a valuation framework based on Bitcoin's potential role in two primary total addressable markets: as a medium of exchange and as a reserve asset for central banks.
The report projects a 15% compound annual growth rate (CAGR) from Bitcoin's current levels, positioning it as a significant player in the global economy. It outlines two pivotal structural shifts for Bitcoin's appreciation. The first, termed the Settlement Pivot, predicts that by 2050, Bitcoin could be responsible for settling between 5% and 10% of global international trade, as well as 5% of domestic trade transactions.
The second shift, the Reserve Pivot, links Bitcoin's growth to waning trust in G7 sovereign debt. As confidence in these currencies diminishes, the authors anticipate central banks might allocate resources toward Bitcoin as a hedge against fiscal instability.
Beyond the base case, VanEck explores an optimistic Bull Case scenario dubbed "hyper-bitcoinization." In this scenario, if Bitcoin captures 20% of international trade and 10% of domestic GDP, its value could skyrocket to $53.4 million per coin, representing a 29% CAGR. Achieving this would require Bitcoin to equal or surpass gold's status as a primary global reserve asset, making up nearly 30% of financial assets worldwide.
For context, the report uses a baseline current price of approximately $88,000 when projecting these values. It also includes a Bear Case target of $130,000, reflecting a modest 2% CAGR. In terms of market behavior, VanEck anticipates Bitcoin will exhibit low to moderate correlation with global equities, bonds, and gold, while emphasizing a persistent negative correlation with the US Dollar (DXY), reinforcing Bitcoin's potential role as a hedge against monetary debasement.
