As recently as last fall, a Bitcoin price prediction of $3,000 in 2017 would have seemed absurd.

In early October, the Bitcoin price was just a bit north of $600. Earlier this week, the price of Bitcoin breached $3,000 for the first time – a gain of 500% in just nine months.

That brings us to Wences Casares, the CEO of the Bitcoin wallet startup Xapo and a member of PayPal Holdings Inc.'s (Nasdaq: PYPL) board of directors. In a May 22 speech to Coin Center, Casares repeated his Bitcoin price prediction of $1 million per Bitcoin in 10 years.

His reasoning is that Bitcoin will emerge as a "global standard of settlement" – the ultimate reserve currency.

Casares first made the prediction in 2014, when the cryptocurrency was in free fall as a result of the collapse of the Mt. Gox Bitcoin exchange.

While a Bitcoin price prediction of $1 million may seem far-fetched, predictions that Bitcoin would reach $3,000 this year would have struck most folks outside the cryptocurrency community as ridiculous.

But Bitcoin, which was worth just $0.003 shortly after its launch in January 2009, has consistently defied skeptics. Bitcoin has gained 88,999,900% since then. (That would have turned $100 into $89 million.)

To get to $1 million from the current price of about $2,300 would be a relatively easy 43,378% jump.

But does that make any sense? What could possibly drive the price of Bitcoin to such astronomical levels?

Surprisingly, there are multiple scenarios in which Bitcoin could reach the $500,000 to $1 million range…

How a Lofty Bitcoin Price Prediction Could Come True

Last month Jeremy Liew, the first investor in Snapchat, and Peter Smith, the CEO and co-founder of Blockchain, developed a Bitcoin price prediction of $500,000 by 2030. They cite three catalysts in particular.

First, Smith and Liew argue that more people will use Bitcoin for remittances, the practice of foreign workers sending money to their countries of origin.

Second, they believe the atmosphere of political uncertainty in both developed nations, such as the United States, as well as developing countries, will drive more people to buy Bitcoin as a safe-haven investment like gold.

Third, Smith and Liew said the use of smartphones for transactions will open the door for Bitcoin. They estimate that Bitcoin could account for as much as half of the world's non-cash transactions by 2030.

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Smith and Liew calculated that the rising usage will result in the average Bitcoin user holding $25,000 worth of the cryptocurrency by 2030. They also assume that the number of Bitcoin users will grow from 6.5 million to 400 million.

Multiplying those two numbers (25,000 times 400 million) gives a Bitcoin market cap of $10 trillion. Dividing that by the fixed supply of Bitcoin in 2030, 20 million, yields the $500,000 Bitcoin price prediction.

Another possibility is hyperinflation…

The U.S. Government Will Boost the Price of Bitcoin

Rapidly increasing borrowing and spending by the federal government could undermine the value of the U.S. dollar to the point that inflation spirals out of control.

This isn't as far-fetched as it may seem.

When the Social Security Trust Fund runs out in 2034, the U.S. government will either need to chop benefits by 25% or jack up payroll taxes on those still working. Politics being what it is, Washington is likely to shun both options and elect to borrow the needed trillions.

Related: How to Buy Bitcoins – Your Guide to Digital Profits

That could easily lead to hyperinflation, in which the prices of everything would skyrocket. Bitcoin would skyrocket faster as a safe haven and store of value.

The price of Bitcoin will benefit even from the tame inflation we have now. After all, the value of the U.S. dollar has declined 97% since 1913. Because Bitcoin is deflationary by definition – it has a fixed supply of coins created at a decreasing rate – it can only gain against the dollar.

But the best chance Bitcoin has of reaching $1 million over the next decade or so could result from a global decision to demote the U.S. dollar from a role it has held for nearly a century…

This Would Send the Bitcoin Price to $1 Million Territory