In a recent paper published by the cryptocurrency exchange Kraken titled “Inheriting USDs & Acquiring BTCs”, the exchange explains why a dramatic increase in Bitcoin’s price is very likely to happen by 2045.
According to the paper, the United States alone is estimated to have a $68.4 trillion intergenerational wealth transfer to “Millennials” and “Generation X”. Both these generations, especially the former, have shown great interest in crypto-assets and Bitcoin in particular which was accompanied by a rise in demand. Between 9% and 15% of American adults own Bitcoin with the number of wallets containing [0.1BTC-1BTC] growing from 240,000 wallets in 2014 to over 2,000,000 in 2020.
The other and very important factor is “job creation”. The awakening of the crypto-industry brought forward an immense increase in number jobs. This rise, between September 2015 and September 2019, is estimated to be over 1,450%. An industry that has created jobs is unlikely to fade into the background.
Assuming the inheritance, and hence the statistical death of the former wealth owners, Kraken has quantified that Bitcoin will have an implied price of approximately $350,000 in 2044. The latter assumes a reasonable 5% peak allocation and 2% tax.
However, when taking into consideration the rise in Bitcoin’s supply by 2044 with the newly mined coins hitting the market, that number with the same assumptions drastically drops to $46,000.
There have been many studies trying to quantify and predict Bitcoin’s future price. From wealth transfer to stock-to-flow or cost of production. Knowing which method is correct will only be possible in hindsight.