Canada's largest independent investment dealer Canaccord Genuity: By 2025 Bitcoin price could reach $5,739

In a November 23 report titled “Checking in on blockchain and bitcoin in financial services”, Canaccord Genuity analysts noted that value of Bitcoin could increase by eight-fold in less than a decade. The technology is at an important crossroads, a Canaccord Genuity says, as governance and structural issues need to be addressed in order for continued success.



“We believe bitcoin holds real promise as a potential disruptive force in the currency and payments markets, and we lay out many progress markers within,” the report said, pointing to the bitcoin ecosystem is at somewhat of a crossroads. “In particular, there needs to be resolution to key issues regarding throughput and governance in order become more mainstream.”



Canaccord Genuity points to a pricing methodology that considers both transnational demand, which can be demonstrably measured, and “store of value” demand, which is more perception based:



"Our framework for assessing the value of BTC according to transactional demand relies on monetary theory and is consistent with how many think about money supply for well-known currencies like the USD. For the “store of value” (SOV) component, we think about the gold market as the best proxy for determining how much BTC market participants might feel compelled to stockpile, or hoard."



Using this along with a more complex formula as a framework, the report says that by 2025 the value of bitcoin could reach $5,739. This is based on an anticipated 20 million BTC in circulation by 2025.



Specifically, the analysts state:



"We project that the amount of bitcoin required for these functions will increase from $6.1B in 2015 to $115.0B by 2025. We also can fairly accurately forecast that there will be approximately 20 million BTC in circulation by 2025. This leads us to an implied 2025 value per BTC of $5,739, which when discounted to present at a 25% discount rate leads us back to the current market price of BTC."