With the stock market off its record high, it looks like investors have adopted a more cautious approach toward cryptocurrencies as well. After the market cap of the digital asset industry peaked at about $3.7 trillion in December, it has fallen 22% (as of March 24). The asset class is once again showing investors how cyclical it can be.
If you’re a long-term investor, though, then there’s an opportunity to take advantage of the volatility and fear. In fact, there’s one cryptocurrency, which is currently trading 19% off its peak, that has 14,623% upside. That’s according to Michael Saylor, the founder, former chief executive officer, and executive chairman of MicroStrategy, an enterprise software company that is incredibly bullish on a single digital asset.
Here’s what investors need to know that just might force them to become huge supporters of this crypto.
Saylor first decided that it would be wise for his company to purchase and hold Bitcoin (CRYPTO: BTC) on its balance sheet back in August 2020. His thinking was influenced by just how much government stimulus had entered the economy after the onset of the COVID-19 pandemic, which made cash a terrible holding. The view was that Bitcoin would maintain and increase purchasing power.
During the past few years, MicroStrategy has transformed into a Bitcoin holding company, raising debt and equity capital to buy more of the crypto. It currently owns more than 500,000 coins.
In Saylor’s base case, Bitcoin’s price will reach $13 million in 2045. Compared to the cryptocurrency’s current price of about $88,300, that presents upside of 14,623%, or a 147-fold rise. This translates to a fantastic 28.4% compound annual growth rate. Saylor sees 7% of global wealth finding its way to Bitcoin in this instance.
The bull case predicts a monster $49 million price by 2045. Even in the bear case, Saylor thinks Bitcoin’s price can rise 34-fold to $3 million per coin. All these scenarios depend on different levels of worldwide capital eventually being allocated to Bitcoin, at the expense of assets like stocks, bonds, or real estate. But regardless of how much optimism you have, it’s clear that Saylor has huge hopes for what the future will bring.
Saylor has become somewhat of a legend in the Bitcoin community. He’s a vocal supporter who has put his money where his mouth is. And in theory, his 2045 outlook for Bitcoin makes sense. All it takes is more of the capital in the world flowing from other assets to the leading crypto.
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