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Mooners & Shakers: Crypto market on edge, but Adam Back sees $10 million in Bitcoin’s future

While a nervous crypto world awaits new US CPI figures, experts have offered shots of hopium – one of them seemingly too good to be true.

Rob Badman
4 min read
2:42PMFebruary 13, 2023
Stockhead
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Think of the boy on the bike as the CPI info and the folks lying down as crypto users. Picture: Getty Images
Think of the boy on the bike as the CPI info and the folks lying down as crypto users. Picture: Getty Images

Another set of US CPI inflation data (for January) looms this week, which is keeping traders in risk markets on edge for the moment.

Meanwhile, Bitcoin, Ethereum and others are dipping a fraction as we type.

We’ll get to some of that nervy price action in a sec.

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But let’s instead first focus on a couple of wildly positive thoughts we’ve noticed this morning, for an early Monday hopium hit …

Adam Back’s ‘hyperbitcoinization’ view

… Firstly, from Adam Back, who is a British cryptographer of note, the CEO of Bitcoin-focused blockchain company Blockstream, and the inventor of Hashcash, which is a system used in the Bitcoin mining process.

In this tweet (below) from Back posted a few hours ago, he references the claim that the price of Bitcoin (BTC) has, on average, doubled (‘2x’) each year since January 2013. And yes, that’s a bit of mathematical tweaking there, as BTC certainly didn’t end up doubling in price in 2022.

The Bitcoin OG (Original Gangster) notes that the stat checks out and that, if it were to continue along on its same averaged-out yearly form, BTC will cross $US10 MILLION per coin, with a $200 trillion market cap within about nine years from now, in accordance with the next two Bitcoin halving cycles.

Yep that was $US10 million. Don’t judge us, we’re just telling you what he said.

Here’s the maths rationale: If bitcoin is worth $20k now, it will go to $40k, then $80k and so on. Ending at $10.24 million in nine years.

Back has posited this kind of thesis for Bitcoin’s future price before, commenting in January that a $US10 million BTC isn’t as far-fetched as it sounds, pointing to the idea that the US dollar could drop considerably in the years to come, along with Bitcoin gaining traction as a widespread currency.

“It’s closer than it sounds as along the path of hyperbitcoinization,” Back tweeted.

“The USD inflation rises, e.g. aided by Modern Monetary Theory rationale for high inflation, so $1 becomes worth say 10c over a decade or two of monetary craziness, then $10mil/BTC is $1mil/BTC in today’s money.

So then … keep “stacking sats” (satoshis – fractionalised denominations of BTC) in the meantime and play the long game? Judging by Back’s stats, it might not be an unreasonable consideration.

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Messari’s golden outlook for BTC

Meanwhile, looking slightly shorter term, the crypto market intelligence and data firm Messari has some interesting statistics of its own, with reference to the aftermath of “golden crosses” in Bitcoin’s chart.

A golden cross recently formed for Bitcoin, with its 50-day simple moving average flipping above the 200-day simple moving average. Some traders tend to get a bit frothy about it because it has sometimes been an indicator of a bullish run.

According to Messari’s stats, however, the price action for BTC can be somewhat lacklustre in the month that directly follows the golden cross.

But … Bitcoin has tended to swing significantly to the upside when looking six months, and a year ahead from the event, with average +34 per cent and +156 per cent returns respectively.

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Top 10 overview

With the overall crypto market cap at $US1.06 trillion, pretty flat since this time Sunday, here’s the state of play among top 10 tokens at the time of writing – according to CoinGecko.

Source: CoinGecko
Source: CoinGecko

Bitcoin (BTC) was dipping quite sharply when we began typing up this roundup, but its since consolidated a tad, back to the $US21.8k level that it seems comfortable to laze around for the moment.

Like we said earlier, the US CPI data is due midweek this week, and it’s very likely keeping risk market traders a little on edge for now, or perhaps sidelined until January’s figures either come in roughly as expected and perhaps a fraction lower than December’s, or “hot” and a little higher.

We’re seeing conflicting predictions around market expectations, but, as MarketWatch notes, “few things moved the US stock market last year like inflation data”. Prepare for some more volatility this week, then.

Uppers and downers: 11–100 Sweeping a market-cap range of about $US10 billion to about $US445 million in the rest of the top 100, let’s find some of the biggest 24-hour gainers and losers at the time of writing. (Stats based on CoinGecko.com data.)

DAILY PUMPERS

• Baby Doge Coin (BABYDOGE), (market cap: $US667 million) +20 per cent

• Render (RNDR), (mc: $US479 million) +11 per cent

• Lido DAO (LDO), (mc: $US2.13 billion) +6 per cent

• Internet Computer (ICP), (mc: $US1.59 billion) +5 per cent

• Solana (SOL), (mc: $US8.1 billion) +4 per cent

DAILY SLUMPERS

• Mina Protocol (MINA), (market cap: $US847 million) -10 per cent

• Loopring (LRC), (mc: $US515 million) -7 per cent

• SingularityNET (AGIX), (mc: $US481 million) -7 per cent

• ImmutableX (IMX), (mc: $US810 million) -6 per cent

• Fantom (FTM), (market cap: $US1.25 million) -6 per cent

Around the blocks

Some pertinence and randomness that stuck with us on our morning moves through the Crypto Twitterverse.

This content first appeared on stockhead.com.au

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Original URL: https://www.theaustralian.com.au/business/stockhead/mooners-shakers-crypto-market-on-edge-but-adam-back-sees-10-million-in-bitcoins-future/news-story/0585278db5f9d61ea6b66242fad8dad8