Disclaimer: The information in this blog represents the opinions of its author and is for educational purposes only. It is not intended as investment advice. The bitcoin market is extremely risky so you should only invest money you are willing to lose.
Our Halloween Price Projection of $8543
We published this chart, exactly as you see it above, with the exact same caption, in our Halloween blog post. A mathematical analysis of price-wave patterns using Fibonacci numbers led us to project a price target of $8543. That was after a high of $6422. Bitcoin is currently trading close to $7500.
After a very quick bounce which almost reached the 38.2% retracement of the recent runup, bitcoin price continued its relentless march toward our price target and eventually $10,000. Since this retracement was a very shallow one, don't get spooked by a deeper pullback into the zone between the 50% and 38% Fibonacci levels ($6738 - $6906), before the next leg up.
Discord over the SegWit2x fork may cause a few hiccups along the way but we maintain our short-term target of $8543, with a projection of $10,000 bitcoin by year-end.
Traditional Investment Returns
When you talk about traditional investment returns, you're probably used to numbers like 10%. The return on real estate averages about 5-10% per year. A good return in the stock market is 10%, with this year being a particularly good one - The S&P 500 index is up about 17.5 % year-to-date.
My Barber And My Mailman are Buying Bitcoin
The Cryptocurrency "x-factor"
Some investment returns in cryptocurrency are so astronomical that it can be hard to wrap your head around the numbers, and it hardly makes sense to talk about them in percentage terms. We project that bitcoin will pull off a 10x this year - That's a 1,000 percent return, in just one year! That means that $1000 invested January 1st - currently worth about $7500, will be worth more than $10,000 by new year's day. You'd have to wait several decades to see those kind of returns in the stock market.
Did you know that cryptocurrencies are by far the best performing asset class over the past 7 years? A $1,000 investment just this past January in ethereum, the cryptocurrency that powers blockchain applications, is worth more than $30,000 today - that's 30x in just 10 months!
Can Your Investments Do That?
It's unlikely that you've ever held an investment that 10x'd in a year, but these returns are becoming more and more common in the cryptocurrency space. Most of your investments probably perform more like the chart below, showing the year-to-date return of $1000 invested in Apple stock, the Nasdaq, or the S&P.
Why is this happening? We are in the midst of nothing short of a revolution.
Amazon is killing retail because they revolutionized the supply chain, taking out the middleman.
The world's largest taxi service, Uber, doesn't own a single vehicle. How? They decentralized ride-sharing, making it peer-to-peer.
The world's biggest accomodation provider, Airbnb, doesn't own a single property, they took the middleman - the hotel - out of the loop.
Are you starting to see a pattern here?
Decentralization, Peer-to-Peer, and Math
- Decentralized services are replacing central proprietary ones
- Math and computation is replacing trusted third parties
- Peer-to-peer algorithms are replacing inefficient corporate services
This is not a fad or hype - this is the future- and it’s here, now.
Now is the perfect time to get into the cryptocurrency market, while it’s outperforming every other asset class.
The Upside Potential
We already know that it's possible to achieve returns in cryptocurrencies in a year that would take decades or even centuries in traditional markets. But what's the upside potential, how big can cryptocurrencies get?
According to Brian Kelly of CNBC's Fast Money, the upside potential is huge. He cites a market cap of $1 trillion (another 10x its current market cap) as a conservative estimate. Others cite even larger numbers, like the total worldwide global currency trading volume on Forex, currently about $5 trillion - every single day.
With current daily bitcoin dollar volume having 10x'd in the past year from $57 million to $628 million, clearly the cryptocurrency market is still a minuscule percentage of the global currency market so the upside potential is huge.