-1

The bitcoin is around 1000USD today even with very little adoption. I am wondering what its value will be if it becomes as common as other currencies (say USD).

closed as off-topic by Nate Eldredge, Salvador Dali, Murch, dchapes, Nick ODell Jan 31 '14 at 6:09

This question appears to be off-topic. The users who voted to close gave this specific reason:

  • "Questions on current market values, energy costs or service provider availability are off-topic as the answers are changing too frequently to be useful to others." – Nate Eldredge, Salvador Dali, dchapes, Nick ODell
If this question can be reworded to fit the rules in the help center, please edit the question.

  • 2
    I don't see how anyone can possibly predict the answer to this question with any accuracy. – Nate Eldredge Jan 10 '14 at 0:18
  • 1
    If you would just think about what the price of one bitcoin is a reflection of, you would see how this can be quite trivially answered, no "prediction" necessary. There is no reason to close this, as the answer is not dependent on "current market values", but rather, how the price of one fraction of an asset class would be valued, given specific conditions (namely, widespread adoption) – hedgedandlevered Mar 9 '14 at 18:56
  • You'd still need to answer with a number. "Maybe alot more than it is now" is the most accurate answer anyone can give. – John T Apr 8 '14 at 23:22
  • 1
    You may want to read my answer before commenting on my response to the denial of the possibility of the existence of an answer... because I did answer with a number, because it is possible to do so. – hedgedandlevered Apr 15 '14 at 2:09
4

The best way to derive the possible value is by looking at market cap of bitcoin as a whole. There is currently about 1.2 trillion in USDs in physical currency alone. There are many ways to count how much USD there is though.

M1 represents all of the currency in the M0 money supply, plus all of the money held in checking accounts and other checkable accounts, as well as all of the money in travelers' checks. In June 2013, the M1 money supply for U.S. dollars equaled about $2.5 trillion [source: Federal Reserve]. M2 is the M1 supply, plus all of the money held in money market funds, savings accounts and CDs under $100,000. In June 2013, the M2 money supply was about $10.5 trillion [source: Federal Reserve]. M3 is M2 plus larger CDs. As of March 2006, the Fed stopped tracking the M3 money stock as an economic indicator because it felt it did not add any information on economic activity that was not already available from M2 [sources: Federal Reserve, Federal Reserve Bank of New York]. All told, anyone looking for all of the U.S. dollars in the world in July 2013 could expect to find approximately $10.5 trillion in existence, using the M2 money supply definition. If you just want to count actual notes and coins, there are about U.S. $1.2 trillion floating around the globe.

so for a complete currency, the "market cap" is around 1 to 12 trillion, which corresponds to a price of $47,619 - $571,000 per coin, using the 21 million bitcoin limit as the supply

  • I believe it'd be fairer to stick the comparison from Bitcoin's M0's hard limit of 21 million to U.S. dollars' M0. Should bitcoins become as abundant as the former, banks would start using it with fractional reserve, thus creating M1 money ex-nihilo so total amount of circulating bitcoins would end up far higher than 21 million... – Joe Pineda Jan 16 '14 at 12:17
  • 1
    I suspect that fractional reserve banking with bitcoin will be quite limited due to the speed and efficiency with which customers could engage in a bank run, and the absence of an ability to create deposit insurance priced in bitcoin. Such insurance could be applied in another currency or gold, but hedging of such costs would likely be prohibitively expensive... I know this is speculation but that's what this question is. Also I wouldn't say "circulating bitcoins" are higher than 21 million. Accounts that hold bitcoin, maybe, but not having instant access to your bitcoins defeats the point – hedgedandlevered Jan 17 '14 at 12:34
  • 1
    This answer has value regardless of the current price, because it provides a methodology for calculation, not just a number. People who vote to close questions sometimes miss the whole point of the question. – Brad Thomas Mar 2 '15 at 14:28
0

I think at some point, probably about the point you describe (where BC is as "common" as US$, assuming "common" means "accepted in as many places), where the question ceases to be "how much is a BC worth (in US$)", and becomes "what is a US$ worth (in BC)".

A item (e.g. currency, chickens) is worth what someone will pay for it. In some other currency.

Not the answer you're looking for? Browse other questions tagged or ask your own question.