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Bitcoin Future One - 2027-2032

2/1/2017

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This is a positive outcome scenario for bitcoin, driven by macro events. Best to think of it as Science Fiction. While writing this I keep in my mind that there is a nontrivial chance that Bitcoin could go to 0. I also run a bricks and mortar retail business so these events would be potentially very bad for me. In the next 10-15 years the following things could happen:

  1. Between 2017-2020 the bond markets collapses, inflation and interest rates rise.
  2. US stock markets return to historical P/E ratios of 16 or less. From the mid 60’s to the early 80’s P/E ratios went from mid 20’s down to 7. The S&P 500 went from 700 to 300 during this period. The Dow from 7358 to 2000.
  3. The price of bitcoin will rise as a decentralised version of protectable wealth. Gold and Swiss Francs will do well too, but not as well.
  4. This rise will lead to euphoria around Bitcoin and it will begin to appreciate faster than the rate of user adoption, much like the 2013 Bubble.
  5. Governments, the general public and large funds will take part. It will correct dramatically but still be at least 3 times the previous trough which was $220 at the start of 2015.
  6. At this stage, when bitcoin leaves it's longer term trend line, and s&p 500 stocks seem to be trending towards record lows(pe5-15), it will be the time to put money into stocks, gradually.
  7. This could be over 5-10 years. Stocks stayed sub 15 pe for 12 years from the mid 70’s to mid 80’s (1974-1987) so this may be hard to stick with but dollar cost averaging would have paid off well during this period.
  8. More Countries will secede as they blame weak nation state monetary policies for their economic woes.
  9. The scaling problem will be solved not due to rational thinking but because the economic incentives will outweigh the egos.
  10. I don’t think price can be predicted except to say it will be more than 10x today’s price if this transpires. Rick Falkvinge and Wences Cesares do though.
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