Bitcoin is back in the top 10 most valuable assets in the world. First place in the line of sight.
Bitcoin first
Here are the top 10 assets accompanied by their market capitalization:
1) Gold: $13,883 billion
2) Apple: $2,974 billion
3) Microsoft: $2,783 billion
4) Saudi Aramco: $2,142 billion
5) Alphabet (Google): $1,658 billion
6) Amazon: $1,519 billion
7) Silver: $1,431 billion
8) NVIDIA: $1,156 billion
9) Bitcoin: $845 billion
10) Meta (Facebook) : $834 billion
Traditional funds generally invest half in the stock market and half in sovereign debt. Unfortunately, these investments are fruitless.
The calculation is simple:
The American stock market (S&P500) only appreciates 7% per year on average. The permanent dilution of shareholders through the issuance of new shares does not forgive…
Conversely, the growth of the dollar money supply (M2) is also 7%. This monetary inflation annihilates the gains made by the stock market. It’s quite simple, the dollar has lost 97% of its purchasing power since 1913:
By the way, alongside the monetary ponzi, the global oil peak that we are currently experiencing will further accelerate the decline in purchasing power.
In short, the dollar is collapsing by 7% per year against the stock market, which barely allows us to avoid getting poorer…
Certainly, owning only a handful of technological monopolies like Apple, Google, Microsoft or Meta offers a superior return. But these companies, however, carry risks that bitcoin does not have.
A CEO can make a big mistake. Mark Zuckerberg has wasted tens of billions on the metaverse and no one knows if the iPhone 25 will still be the smartphone everyone wants.
And let’s not talk about sovereign debt, whose yields have long been well below inflation.
Bitcoin, the ultimate store of value
Preserving wealth requires investing it in assets that are rare, desirable, portable and durable.
Bitcoin is desirable because it is the most powerful monetary network in the world. It is protected by 16 gigawatts, 500 EH/s, 800 billion dollars and 220 million investors.
Its money supply is limited to 21 million units. While the production of gold continues to increase year after year, that of bitcoin decreases by half every four years.
More than 93% bitcoins are already in circulation. The money supply will be almost fixed from 2036, when the “Stock to Flow” ratio will be 1018. For comparison, that of gold is 60. Which means that 60 years of annual production are enough to double the stock of existing gold.
The supply of bitcoins (compared to the existing stock) will be half that of gold from the halving next April. And 17 times lower from 2036…
This is why the barbarian relic no longer holds up. Not to mention the impossibility of sending gold instantly and for free to the other side of the world, among other limitations.
And real estate?
Real estate in major capitals also appreciates by around 7% per year. Once again, not enough to beat monetary inflation.
And let’s not forget the taxes, the works or even the gravity and entropy which cause a building to collapse after 100 years.
Next, how do you teleport a house to another country in the event of war or hyperinflation? Real estate is immobile and illiquid. The sales process takes months or even years.
Each bitcoin can be compared to a block of New York, Paris or Tokyo having the advantage of being indestructible, liquid and movable at any time. No Ukrainian, no Argentinian was able to leave with his home in his head.
Another pitfall, real estate is reserved for a minority. You must already be rich. Conversely, it is possible to buy bitcoin from 10 euros. Same observation for art. Who can buy a great master painting?
Owning a building in Buenos Aires allows you to avoid the worst. But owning bitcoin allows you to teleport it to another country and sell it instantly.
For Anglophiles, here is Michael Saylor’s presentation at Bitconf and on which this article is based:
1 bitcoin for $1,000,000
All the wealth in the world is currently stored in:
-The stock markets ($115,000 billion)
-Real estate ($330,000 billion)
-Sovereign debt ($300,000 billion)
-Art ($18,000 billion)
-Gold ($13,000 billion)
-Bank accounts + cash ($120,000 billion)
-Etc…
What will happen when multinationals like Apple and Microsoft imitate Microstrategy by swapping their cash invested in US Treasury bonds for bitcoin?
We’re talking about $20 trillion in cash. That’s almost twice the value of all the gold in the world. In other words, there is plenty to do for the years to come.
Michael Saylor predicts an average annual appreciation of 21% for the next ten to twenty years. Consequently, at maturity, the CEO of Microstrategy expects 14%, twice as much as the S&P 500.
Bitcoin is a singularity whose impact on other assets promises to be fascinating. A cake of at least a hundred billion dollars is reaching out to him.
The Bitcoin ETFs expected for January and the fourth “halving” should perpetuate the prophecy. This Bull Run is on.
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