Renowned on-chain analyst Willy Woo confronted his followers with a new Bitcoin price forecast and predictions about the market trajectory. Through his X account with 1.1 million followers, Woo listed the conditions for the largest cryptocurrency to reach a price of $1 million, and said that he does not think such a situation will happen in this bull season.
Stating that 1% of the global asset value should come to Bitcoin, Woo stated that this figure is $5 trillion and used the following statements:
“What should be the multiplier ratio”
What should the market capitalisation be to reach the $1 million price? Assuming we reach this price in the short term, the number of coins would be 19.8 million. This makes the total market capitalisation required $19.8 trillion.
So what should be the multiplier of the invested capital and market capitalisation?
This, of course, depends on liquidity conditions. The deeper the liquidity, the lower the multiplier.
This metric, also known as the MVRV ratio, was 8 times at the 2013 peak. It was 4.8 times at the 2017 peak and 4.0 times at the 2021 peak. Historically, when we look at this liquidity trajectory, we can expect the next multiplier rate to be 3.5 times. If we reach $1 million in the next cycle, the number of multipliers will decrease even more as liquidity will deepen even more. Therefore, the power of each $1 invested to move the price will also decrease. As a result, in terms of the capital required, I will conservatively accept a multiplier of 3.5 times.
“It should be 5.66 trillion dollars”
If we divide $19.8 trillion by 3.5, there should be $5.66 trillion in the network. This represents realised capital. Since the blockchain records each wallet with a time record, we can also estimate the money paid when entering the wallet. The realised market value should be $5.66 trillion.
As a result, when we consider that the realised market value is currently $620 billion, we still need an inflow of $5 trillion.
“I don’t think it will happen in this bull”
But I would like to say again that these are very conservative comments. Also, in this bull, I don’t think we will reach a price of $1 million per coin. It will take time for $5 trillion to enter the market.