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29 October, 2024

VanEck Predicts Bitcoin Could Reach $3 Million by 2050, Citing Global Reserve Asset Potential

29 October, 2024

VanEck Sees Bitcoin as a Key Global Reserve Asset, Projecting a $3 Million Price Tag by 2050

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As Bitcoin continues its upward trajectory, approaching the $70,000 mark, VanEck, a prominent asset manager and crypto ETF issuer, is making bold predictions about its future. In a recent interview with CNBC, Matthew Sigel, head of digital asset research at VanEck, shared his insights on Bitcoin’s potential trajectory, considering the upcoming US presidential election and broader economic factors.

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Sigel highlighted several correlations driving Bitcoin’s current price dynamics, including a negative correlation with the US dollar and a positive correlation with the global money supply growth (M2). He attributes the recent price recovery to the Federal Reserve’s renewed focus on M2 growth and a perceived “seller exhaustion” in the Bitcoin market.

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Political and Economic Influences

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Sigel believes that the US presidential election will significantly influence Bitcoin’s short-term trajectory. He noted a pattern from the 2020 election, where Bitcoin remained relatively stable until the outcome was announced, followed by a substantial rally as new buyers entered the market. Sigel expects a similar scenario this year, emphasizing that “new buyers are born every day.”

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Furthermore, Sigel pointed to recent activities within the BRICS intergovernmental organization, including the involvement of new members Argentina, the UAE, and Ethiopia in Bitcoin mining. He suggests that these countries are utilizing government resources to mine Bitcoin as a countermeasure to what he calls the “irresponsible” fiscal policies of the US.

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A Staggering Price Projection

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Looking ahead, Sigel predicts that Bitcoin’s price could reach approximately $180,000 post-election, based on historical rallies that have seen increases of around 2,000%. However, his most striking prediction is that by 2050, Bitcoin could serve as a reserve asset for global trade, held by central banks at a rate of 2%, leading to a staggering price of $3 million per Bitcoin. This projection is based on a model developed by VanEck’s digital asset research team.

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A Dynamic Cryptocurrency

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Sigel describes Bitcoin as a “chameleon” due to its constantly shifting correlations with various assets. This dynamic nature makes predicting Bitcoin’s short- and long-term price behavior a challenging endeavor.

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Despite the uncertainties, VanEck’s bold predictions highlight the growing belief in Bitcoin’s potential as a global reserve asset. As the cryptocurrency market continues to evolve, it will be fascinating to witness how Bitcoin’s trajectory unfolds in the coming years.