Can Bitcoin Surpass the '$31 Trillion' Gold Market?

▲ Bitcoin (BTC), Gold/AI generated image ©

As the market capitalization competition between gold, the king of traditional assets, and the leader of digital assets heats up, a long-term outlook on whether the virtual asset leader can surpass gold's massive stronghold has been presented, drawing the attention of investors.

According to cryptocurrency media Watcher.Guru on May 20 (local time), gold has been on an unprecedented bullish rally since late last year, when investors showed a strong tendency to avoid risky assets. Bitcoin (BTC), on the other hand, showed a contrasting trend, entering a temporary price correction phase immediately after touching its all-time high of $126,080. Market experts diagnose that while both assets boast impressive returns, due to the limited supply of digital assets, a scenario where Bitcoin's market capitalization surpasses gold's in the long term is not technically impossible.

According to data from CompaniesMarketCap, a global platform for comparing corporate and asset market capitalizations, gold's current total market capitalization boasts an astronomical scale of approximately $31 trillion. In contrast, BTC's current circulating supply is around 20 million units. Bitcoin, whose final issuance limit is capped at 21 million units by federal law and network algorithms, will complete all mining by 2140. Assuming the circulating supply is fixed at 20 million units and reaches the current market capitalization of gold, the price per coin would have to soar to approximately $1.55 million. This figure would require an increase of over 1,913% from the current price range.

This scenario of breaking the $1 million per coin mark has been a key topic consistently discussed among experts in the global virtual asset financial industry. Matthew Sigel, Head of Digital Asset Research at global asset management firm VanEck, predicted that Bitcoin could reach the $1 million mark within approximately five years. Matt Hogan, Chief Investment Officer (CIO) at Bitwise, declared that even the $1 million target is too conservative, and that a price increase far exceeding this will occur in the long term, considering its scalability as a store of value.

Such hyper-bullish sentiment is also supported by global titans. Pavel Durov, founder of the messaging platform Telegram, recently emphasized in a podcast interview with Lex Fridman that Bitcoin will eventually hit the seven-figure price range of $1 million. In addition, industry giants such as Binance founder Changpeng Zhao (CZ), MicroStrategy founder Michael Saylor, and Ark Invest CEO Cathie Wood are also largely joining the ranks of those predicting Bitcoin's breakthrough to $1 million, based on its long-term store-of-value narrative.

However, the media points out that even if Bitcoin continues to increase in value in the future and reaches the $31 trillion market capitalization mark, it is highly likely that gold's market capitalization will also rise concurrently at that point, moving to an even higher number. While both assets are expected to achieve tremendous capital inflows and growth in the upcoming macroeconomic environment, a sober analysis suggests that the scenario of Bitcoin completely surpassing gold's market capitalization and seizing the absolute throne of the asset market will be difficult to realize for the time being.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*