How a $ 1 million Bitcoin price will lead the billionaire to tip
The explosion of wealth that will occur as bitcoin grows in value will create a new class of billionaires.
When technological change happens in society, it happens quickly and in a pronounced way. Exactly a decade ago, Apple’s market cap had just matched Exxon Mobile’s market cap of $ 310 billion. Over the next decade, Apple’s market capitalization rose to over $ 2.4 trillion, and Exxon’s declined from $ 100 billion to $ 216 billion. This gap will likely only increase over time.
Today, get started in bitcoin. Even though its volatility has put our patience to the test, bitcoin is killing it. As of this article, bitcoin has once again crossed the $ 50,000 mark and its price has risen over 280% from last year. Bitcoin, blockchain, and crypto are considered by technocrats to be one of the fastest growing tech industries, as evidenced by venture capital firm Andreeson Horowitz’s creation of their new $ 2.2. billion from “Crypto Fund”.
A well-known partner of Andreeson Horowitz, Balaji Srinivasan, who was also Coinbase’s first CTO, wrote an article titled “The Billionaire Flippening” articulating what he believes to be the structural impact on society of the ever-increasing price. growing bitcoin. When cryptocurrency enthusiasts hear the term ‘flipping’, most think it describes a period in which Ethereum’s market cap dwarfs Bitcoin’s market cap. However, for Balaji, it looks like there is another, perhaps more fascinating, turnaround that will happen soon – the billionaire turnaround. He says that when bitcoin hits milestones like $ 100,000, there will be as many bitcoin billionaires as traditional billionaires. When bitcoin hits $ 1 million, the world’s bitcoin and crypto billionaires will surpass the number of traditional billionaires.
In “The Billionaire Flippening”, Balaji explains the math-
“There are ~ 2393 addresses with> 1000 BTC. At $ 1M / BTC, there would be 2,393 billionaire addresses.
“Bitcoin currently accounts for around 60% of the total crypto market cap, so assuming a similar distribution of wealth for other coins, and assuming that the entire crypto market cap appreciates with bitcoin, multiply 2393 by 1 / 0.6 to get about 4000 addresses of crypto billionaires. Today there are about 2000 billionaires. 4000 / (4000 + 2000) = 0.66 would mean that about 66% of billionaires were from the crypto, which is an overshoot. If I recall correctly, back when my colleague estimated this, the actual threshold was $ 200,000 / BTC, like a point between $ 100,000 and $ 1 million / BTC for guess when 2000 instead of 4000 new billionaires came from crypto A proper curve fit may result in a higher number, given the exponential drop in BTC per address.
To add my own math to its calculations, bitcoin’s CAGR (compound annual growth) of 200% means it’s reasonable to assume that over the next two years, half of the world’s billionaires will have made their fortunes from the cryptocurrency (when one bitcoin equals), and within five years (when one bitcoin equals $ 1 million) there will be more bitcoin / crypto billionaires than in all other industries combined!
This represents the biggest structural change in wealth since the emergence of personal computers in the 1980s. Since Apple matched Exxon Mobile’s market cap in August 2011, the history of the two companies has diverged. Apple became the first trillion dollar company. It now sits at an incredible market cap of $ 2,478 trillion, or2.2 trillion more than Exxon’s. In the Information Age, change is constant and whoever correctly predicts change wins the loot. While the future of Bitcoin is uncertain, it represents the change of our generation. A change in the way we bank, socialize and are structured. So for all of you, HODL – most of the world’s future billionaires have done it!
This is a guest article by Jacob Kozhipatt. The opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.