I just caught an article titled, 'Bitcoin could reach $1M in 5 years due to fiat currencies' collapse, says Samson Mow', published on December 12 at CoinTelegraph.com and I agree it's a real possibility considering the amount of debt taken on by the world's governments since the U.S. dollar went full fiat in 1971.
The transition to fiat, according to Richard ('I'm not a crook') Nixon, was supposed to be temporary. It's been more than 52 years since the 'Nixon Shock' which then led to the oil embargo imposed by OPEC and led by Saudi Arabia (1973 / 1974). Unemployment rates rose and a combination of price inflation and wage stagnation, lead to economic stagflation, an extended period of little to no growth.
Since then, we've seen a few issues pop up such as high inflation in the late 70's / early 80's, prompting Paul Volcker to raise interest rates to 20%, collapsing the economy into deep recession. Then came the Savings & Loan / Asian Financial Crisis of the 90s, followed by the Dot Com bubble bursting, followed by the Panic of '08 which morphed into the Great Financial Crisis.
Since that time, central banks around the world lowered interest rates to record lows and even going negative in some cases (E.U / Japan) which was and still is an unprecedented event. All this managed to do was create the mother of all bubbles, now known as the Everything Bubble.
Then came Covid. What a convenient distraction away from central bank shenanigans. While the populace was preoccupied with trying to avoid catching the flu, governments around the world, with the help of their central banks went on a money printing spree the likes we've never seen before.
As an example, I live in Canada. Before Covid, Canada's national debt was around $600 Billion (the good ol' days). We were already struggling to pay this down. Crime Minister Justin Trudeau's Liberal government has managed to double the debt since March 2020, handing out stimmys to stay home for a year. The total debt now sits at $1.2 Trillion. This isn't including all the provinces and territories. Ontario's debt is approaching $500B.
There's no way we can pay this off. This is a sure sign the Canadian fiat dollar is in trouble and well on its way down relating to purchasing power. Gold is at record highs against the Canadian dollar and just about every other currency in the world. Gold is now muscling its way to new record highs against the almighty U.S. dollar.
It's the same situation with all the top economies of the world. In the U.S., the debt has surpassed $31.447 Trillion and even though the FED is in QT mode, the debt continues to rise. See for yourself at USDebtClock.org by clicking here. There's no way this can be paid off (unless gold is repriced?).
Maybe that's why China purchased 32 tons of gold in November. Maybe that's why they added yet another 30 tons in December? They know something is up. Rising debts are destroying the purchasing power of currencies around the world.
It seems obvious to me the financial system is undegoing an overhaul, a paradigm shift if you will. This has happened so many times before but because it's been 50 years since the last shift, a huge chunk of the population alive today has never experienced such an event. Although many remember it as the Nixon Shock, it is more appropriately known as Bretton Woods II. Bretton Woods I came about in 1944 which determined the U.S. dollar as the world's reserve currency. Before that, the British Pound held the title.
The point I'm making here is that there were at least 3 different financial paradigms in the 20th century. Why should things be any different in the 21st century. It's clear fiat currencies are collapsing. The price of gold against these currencies is a testament to that fact yet, there is another factor that shines a massive spotlight on depreciating currencies... Bitcoin!
Bitcoin just had its 15th birthday. I believe that many years from now, looking back in retrospect, historians will see that 2007 and the birth of Bitcoin marked the beginning of the new financial paradigm. The depreciation of the world's currencies is appreciating exponentially at this point. Their final demise will be quick and sudden.
Gold and other commodities will be brought back as a form of reserve to back new currencies to re-instill confidence in said currencies. As for Bitcoin, the dollar price it could go to may very well be infinity, so a price of $1M for one Bitcoin is not crazy at all. In fact, when our currencies are officially in free fall and there can be no denying it any further, a value of $10M or $100M per Bitcoin is feasible. Maybe even a billion? At that point, the central bank printing presses will be running 24/7, 8 days a week.
In the early 1920s, Germany's currency suffered an epic collapse and an ounce of gold went from 150 marks to 87 Trillion. That's not a typo. This really happened and it totally collapsed Germany's once thriving economy. More recently, it was Zimbabwe. We should expect more currencies to collapse like dominoes. Had Germans bought just one ounce of gold in 1919 or early 1920, it would have spared them from financial ruin.
In my own honest opinion, I see gold and Bitcoin side by side in this new paradigm, possibly at par with each other. I don't have a crystal ball so nothing is guaranteed but going forward, wouldn't you want to own a bit of both knowing what's ahead of us.
As for Bitcoin, I am earning free Satoshis using the CrytoTab browser (lite). I've just surpassed 4,000 Satoshi after just a few months. Yes, I can buy on the open market which I plan on doing but it's nice to know I can earn free supplemental fractional Bitcoin. One Satoshi is only worth fractions of a penny today but how much will it be worth in a few years time if (and when) Bitcoin does go to $1M? Then, each Satoshi would be worth 10 cents. Those free 4,000 Satoshis would then be worth the equivalent of $400.
There's all this talk of Bitcoin going down further. I must say, it's held that $16,000 mark very well over the last year or so, don't you think? As of this morning, it's up to $17,284. With all the debt increasing wildly around the world, I really don't see Bitcoin going down further, especially with this crazy high inflation and interest rate environment. Bitcoin and gold (and silver!!!) are probably the best hedges to navigate through such an environment.
Do you agree we'll see Bitcoin hit $1M within the next 5 years? Share your thoughts by leaving your comments below. I do my best to reply to most if not all comments. Hats off to Bitcoin HODLers everywhere!
As for the date Bitcoin hits $1M, no one can know for sure but we all know the date is approaching and probably much faster than we realize.
Peace and Love to everyone.
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