WHAT IS BITCOIN WORTH? WHAT WILL BITCOIN BE WORTH? Many people have told us what they think Bitcoin might be worth today, tomorrow, by the end of the year, in 2018, in five years, in ten years. It’s all guesswork. No one knows. Let’s take the next few blog posts to start evaluating Bitcoin by different measures to give us a feel for what the possibilities are.
The first valuation for Bitcoin will be a comparison to gold. Let’s say that Bitcoin one day takes over the position gold has in the world for representing wealth. There’s a fixed amount of gold. Of course, more is being mined every year but that represents just a small fraction of the total amount of gold that is already in existence. From Wikipedia, there are an estimated 165,000 to 171,300 metric tons of gold. That’s about 181,881 ordinary tons or 363,762,732 pounds, or 5,820,203,717 ordinary ounces. Let’s just call those 5.8 billion ounces.
There are 7.6 billion people in the world. That is just about 3/4 ounce of gold per person for every person on earth. That is, by today’s rate of $1,286.10/oz., $981.50 worth of gold per person. All the gold in the world is worth $ 7,459,377,200,000.00. That’s 7.5 trillion dollars worth of gold.
There is 16,366,275 bitcoin in existence today. If they are going to represent the same worth of gold, one bitcoin would be worth $455,777.33. Sounds absurd? Using the M2 money supply definition, if you were to look for all of the U.S. dollars in the world you could expect to find $10.8 trillion in existence. If you want to count only actual paper and coin, there are about $1.2 trillion around the world.