Bitcoin On Track For $1 Million Per BTC “Fair Value”, Analyst Says

Keshav Verma

1 year ago

3 mins read

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An analyst has explained how the “fair value” of Bitcoin appears to be on track to achieve the $1 million milestone by 2035.

Bitcoin Total User Count Could Forecast Fair Value Path Forward

In a new post on X, analyst Willy Woo has discussed about how the fair value of Bitcoin could look like in the future based on the growth curve in the total user count on the network.

The “total user count” here refers to the total number of investors present in the BTC space. Often, this metric is equated with the total number of addresses on the network carrying a balance, but in reality, it’s not the most accurate method as a lot of investors own multiple wallets.

To make an estimation of an adoption curve, Woo has referred to all past studies done on the user count. The analyst shared the below chart in an X post a few days back.

The adoption curve of the cryptocurrency over its entire history | Source: @woonomic on X

The early part of the chart here is based on Glassnode’s on-chain clustering of addresses into “entities.” An entity is a collection of Bitcoin wallets that Glassnode has determined to belong to the same investor.

For the next part of the curve, Woo has added the Cambridge and Crypto.com data on verified exchange users. Finally, the analyst has projected the resulting growth rate forward.

According to this curve, there are a total of 426 million Bitcoin investors at the moment, with the number estimated to hit the 0.5 billion milestone by October of this year. Interestingly, the price of the cryptocurrency has been oscillating around this total user count growth curve throughout the years, as the below chart depicts.

The adoption curve of the asset compared against its price action | Source: @woonomic on X

More specifically, this oscillation in the price around the adoption curve of the cryptocurrency has existed since 2012. This means that in the pre-2012 period (the shaded region in the graph), this pattern doesn’t quite hold.

“In the early days price was slow to catch up to user count, BTC didn’t even have a price until the 1000th user came in,” notes Woo. “Price discovery started with early markets like New Liberty Standard and MtGox. By Aug 2011 Bitstamp launched and we had multiple global exchanges to properly price the asset.”

Now, if the growth curve of Bitcoin is taken as a guide for its future value as well, then the analyst projects a $1 million per BTC fair value by the year 2035. “Fair value” here is based on the line around which the asset has been oscillating.

From the chart, it’s visible that BTC has historically gained distance over this line during bull markets, so the peak value in future rallies can be significantly more than this fair value.

It now remains to be seen how the price of the cryptocurrency will develop in the coming years and whether this relationship between it and the total user count will continue to hold or not.

BTC Price

Bitcoin has observed a plunge of more than 8% over the past week, which has brought its price down to $58,600.

Looks like the price of the coin has registered a sharp drop recently | Source: BTCUSD on TradingView

Featured image from iStock.com, chart from TradingView.com

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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