If Andresen’s prediction comes true in 40 years, Bitcoin will have increased by approximately 13,636.36 percent.
According to developer Gavin Andresen, the price of Bitcoin (BTC) could reach $6 million due to inflation alone by 2061. If all other conditions remain constant, unavoidable inflation will inevitably raise prices.
“The BTC price is six million US dollars – equivalent to about a million 2021 dollars due to inflation,” Andresen explained.
Bitcoin Price Analysis by Gavin Andresen
According to him, transaction costs will inevitably rise as prices rise. “Miners are rewarded 0.006103515625 BTC per block, plus transaction fees of about 5 BTC for 4,000 or so transactions ($7,500 per transaction”),” he explained. According to CoinGecko metrics, Bitcoin was trading around $44,000 at the time of reporting. If Andresen’s prediction comes true in 40 years, Bitcoin will have increased by approximately 13,636.36 percent. To put things into perspective, $10 invested in Bitcoin today could be worth $1,363.6 by 2061, according to Andresen’s estimate.
However, other fundamental factors, such as Bitcoin’s scarcity level, must be considered. In 40 years, the asset’s value could skyrocket. Furthermore, only 21 million BTC will ever exist, and increased institutional and retail demand is expected to scale over the next decade.
According to analysts, global central banks are likely to hold Bitcoin as an asset against impending inflation. Furthermore, El Salvador has pioneered the use of Bitcoin as legal tender alongside the US dollar.
“However, 20 million or so BTC continue to circulate on other blockchains, valuable because there are a limited number of them and because BTC was the first scarce digital asset,” Andresen explained.
Bitcoin and Cryptocurrency Growth Prospects
Analysts estimate that many global economic aspects will have to be affected for Bitcoin and the crypto industry to continue their meteoric rise in the coming years. Among them is how governments perceive the cryptocurrency industry, particularly in terms of regulations.
As more countries implement clear cryptocurrency regulations, institutional investors will be well-positioned to participate in crypto investments. Leading global economies, such as Germany and Canada, now allow institutional investors to purchase digital assets.
As more energy production becomes greener and renewable, institutional investors are likely to participate in mining activities. “These whales will keep the Bitcoin network running indefinitely. They are the miners and transaction creators; they don’t care how high transaction fees go as long as they receive as many fees as they pay,” Andresen added.
More developments are expected to impact the financial sector, particularly the decentralized financial ecosystem that has swept the market.