One of the most asked questions is if it’s possible to estimate value of bitcoin in order to understand and predict where this important revolutionary coin will go in terms of prices compared to existing fiat currencies.
For bitcoin as an asset, there is a price, and this is what we all see on our computer monitors each day and which we always hear on media.
And then there is a fundamental bitcoin value which is difficult to calculate and estimate. It can be determined or evaluated by the following elements:
- Project experience. Bitcoin is the most experienced;
- Experience of developers on the project. Bitcoin has the most experienced and professional developers in the world, and they are cooperating for making bitcoin always greater; The project is open source and open therefore to any talented programmer;
- Goals that the project wants to reach. bitcoin is able to create value store and permissionless transactions in a decentralized way, without any intermediary. Therefore a permission-less and censorship-resistant environment is created where no middleman is allowed;
- Activity of the project. Just see, as an example, the number of commits and all the activity on this project on github repository;
- Real people problems which the project is resolving: 1) people who want to save money, must use a bank. So they have to give their money in the hands of a bank (or other intermediary) which can freeze, seize, block and generally interfere with financial freedom of people. People is also loosing privacy using intermediaries because they can track any detail of financial profile of clients. People want to get rid of banks to be free to manage their funds without lack of privacy and freedom. 2) inflation, bank commissions, taxes, etc are lowering the power of money. So money gets less and less value with time;
Those are important aspects in estimating bitcoin real value. When time passes, the market price of the asset will tend to become as much as the fundamental value, when the “noise” of speculation is kept of out of consideration.
The fundamental value, also, raises with adoption. The adoption increases when people start to have more informations and to know better the matter.
It is also important to notice that bitcoin gives to unbanked persons the possibility to enter into the economy. And a larger partecipated economy is a benefit for anyone of us. So by increasing adoption, the whole elements of economy will take advantage.
For these reasons, in my opinion the fundamental value of bitcoin is many times more than the actual market price.