Bitcoin price could be $500, zero by 2030, very first Snapchat investor says
Bitcoin just soared to a fresh $1,600 high — but the very first investor in Snapchat thinks it could hit $500,000 by 2030
Jeremy Liew. Getty
Bitcoin has been the top-performing currency in the world in six of the past seven years, climbing from zero to a fresh high value of about $1,600.
But the cryptocurrency isn’t anywhere close to its potential, according to Jeremy Liew, the very first investor in Snapchat, and Peter Smith, the CEO and cofounder of Blockchain.
In a presentation sent to Business Insider, the duo laid out their case for bitcoin exploding to $500,000 by 2030.
Their argument is based on enlargened interest in bitcoin, thanks to:
Remittance transfers, or electronic money transfers to foreign countries, have almost doubled over the past fifteen years to 0.76% of gross world product, data from the World Bank shows.
“Expats sending money home have found in bitcoin an inexpensive alternative, and we assume that the percentage of bitcoin-based remittances will sharply increase with greater bitcoin awareness,” the two said.
Liew and Smith said enlargened political uncertainty in the UK, US, and developing nations would help elevate the level of interest in bitcoin.
“We believe bitcoin awareness, high liquidity, ease of transport, and continued market outperformance as geopolitical risks climb on will make bitcoin a strong contender for investment at a consumer and investor level,” the two said.
Liew and Smith said the percentage of noncash transactions would climb from 15% to 30% in the next ten years as the world becomes more connected through smartphones.
The global smartphone invasion rate is 63%, and the total number of smartphone users is expected to increase by one billion by 2020. The GSMA, a trade bod that represents the interests of mobile operators worldwide, says 90% of these users will come from developing countries.
This would make it possible for almost everyone to have a bank in their pocket, and that should provide a boost for bitcoin as well. Liew and Smith say bitcoin could account for 50% of all noncash transactions.
Here are the basic model drivers Liew and Smith used:
- A bitcoin price of $1,000 in 2017.
- Network users will grow by a factor of sixty one from now until 2030. “Put another way, we need a population of bitcoin users around a quarter of the Chinese population (or 5% of the global population) in two thousand thirty to see bitcoin at $500k,” Liew and Smith told Business Insider.
But a lot could go wrong, too. News surrounding bitcoin has been rather negative as of late.
China, which is responsible for almost 100% of trading in bitcoin, has been cracking down on trading. The three thickest exchanges recently announced a 0.2% fee on all transactions and blocked withdrawals from trading accounts.
The US Securities and Exchange Commission also rejected two bitcoin exchange-traded funds and will rule on another one in the future. It’s not expected to be approved.
However, Smith says bitcoin is still in its early stages.
“The SEC’s ruling wasn’t a surprise to us,” he told Business Insider. He said that “getting that sort of approval” could take a long time.
“In the meantime, bitcoin is already ordinary to buy and hold, and as the asset proceeds to mature, we’ll proceed to see an increase in the development and deployment of surrounding products,” he said.
And while bitcoin hasn’t been granted regulatory approval in the US, it is catching on elsewhere. On April 1, the cryptocurrency became a legal payment method in Japan.
Another threat to its future is developers who are menacing to set up a “hard fork,” or alternative marketplace for bitcoin. This would result in the split of into bitcoin and bitcoin unlimited. However, Smith isn’t worried.
“Bitcoin has strong economic incentives to prevent this,” he said. “If the last two years of healthy contention and debate lead to a conclusion, it’s that bitcoin is exceptionally resilient and stable. In fact, the bitcoin blockchain has operated for seven-plus years with no downtime, a feat no other back-end system operating at this scale can claim.”
But the cryptocurrency sees violent price swings uncommon among the more traditional currencies. Bitcoin rallied 20% in the very first week of two thousand seventeen before crashing 35% on word that China was cracking down on trading.
The cryptocurrency has regained those losses and is trading up about 67% so far this year.