While Bitcoin (BTC) and crypto have become a global trend, with some of the world’s most powerful people talking about it, this asset class is still minuscule in terms of its financial influence.

In fact, the entire market capitalization of digital assets is a puny $274 billion — a sum that equates to the net worth of the three most wealthy men, or 25% the size of all Apple (AAPL) stock in circulation. That’s small.

If those statistics don’t give enough perspective, here’s another. As pointed out by Larry Summers, the former Vice President of Development Economics and Chief Economist of the World Bank, gold, at $7 trillion, is around 1% of global wealth. And, cryptocurrency is approximately 5% of that.

Brilliant keynote by Larry Summers at the 75th Bretton Woods Anniversary Conference: "Gold is 1% of global wealth & all crypto is 5% the size of gold. So crypto is 0.05% of world wealth & that is just about right".

In my view that is 0.05% too much as crypto is worth less than 0 pic.twitter.com/PojcRBsSIU — Nouriel Roubini (@Nouriel) July 23, 2019

Thus, if you do the napkin math, cryptocurrencies consist of approximately 0.05% of the world’s wealth.

But that’s not exactly all. Firstly, much of digital assets’ supplies are tied up in lost accounts and contracts. And secondly, the $274 billion market capitalization of cryptocurrency is actually a misnomer, as far less than $274 billion in liquid capital brought this space to where it is today, according to estimates from JP Morgan.

Long story short, cryptocurrencies are effectively nothing more than a proverbial drop in the bucket of wealth, money, and power. And according to Summers, this is right.

But, many are sure that cryptocurrencies have lots of legroom, lots of room to grow, as they suggest there’s no way that Bitcoin stops at 0.05% of the world’s wealth.

Bitcoin’s First Target: Gold

The industry’s first goal is to usurp gold as the go-to store of value, which would imply a Bitcoin price of $400,000 to $500,000 a pop.

As reported by NewsBTC on an earlier date, all gold in circulation is currently valued at approximately $7.83 trillion, while all Bitcoin has a mere $180 billion valuation. Should the latter fully displace the value of the first, industry analytics firm Crypto Voices estimates that BTC would swell to a value of $450,000.

https://twitter.com/Rhythmtrader/status/1153408202752401408

But is it possible?

According to some, it’s entirely possible.

As Gemini’s Tyler Winklevoss once explained, Bitcoin is “better at being gold than gold itself” — a sentiment held by many long-standing cryptocurrency investors.

The Mark Zuckerberg rival specifically looks to the fact that BTC is portable, sculpted for today’s digital society, even scarcer than the metal, censorship-resistant unlike traditional assets, and decentralized as a way to back this cheery sentiment. At one point, the cryptocurrency entrepreneur added that the only thing that gold has over BTC is a “3,000-year headstart.”

What’s also important is that many in mainstream financial channels and media have begun to confirm that they think Bitcoin is a proper store of value. Just look to Grayscale’s “drop gold, buy Bitcoin”, campaign, which generated a fair amount of discourse in the American investment scene.

BTC v.s. Gold has Already Begun

Just recently, Steven Mnuchin purportedly gave Bitcoin a nod as a speculative store of value. If true, this would mark a massive step forward in the public’s knowledge of the cryptocurrency.

You see, for most of the asset’s life so far, it has been deemed a criminal’s coin, used for nothing else but things that aren’t kosher. But, with Mnuchin acknowledging it as a viable asset, maybe even a proper store of value, it becomes validated in the eyes of millions of American citizens.

This comes shortly after Jerome Powell of the Federal Reserve made a similar comment in front of a group of lawmakers.

Also, Chamath Palihapitiya, a former Facebook executive, told CNBC that Bitcoin is the perfect hedge “against the traditional financial infrastructure”. He elaborated that if fiscal or monetary policy is wonky, as it arguably is now, having Bitcoin is like “the schmuck insurance you have under your mattress”.

Tyler Cowen, an economist that frequents Bloomberg’s op-ed column, recently wrote an article detailing four reasons why he believes Bitcoin will succeed. A number of those reasons mentioned Bitcoin’s viability as a hedge against populism and geopolitical unrest.

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