The recent standoff in US Congress regarding increasing the debt-limit had a small effect on Bitcoin but not that much. It is doubtful that even if the US defaults/defaulted on its debt, Bitcoin would see a huge influx (read Danny Bradbury’s Coindesk article for a good analysis). However, I think the price of Bitcoin measured in USD will be on an upward trend now that the infrastructure around the Bitcoin protocol is more stable, there are established exchanges and merchants are adopting the crypto-currency. It is probably only a matter of time before a Bitcoin is worth more than $1000. How would this affect the Bitcoin users, and how will things be then? Here’s what I think –
- More (Stupid) News Coverage: The media will find another reason to write about Bitcoin and crypto-currencies and there will be more ‘pundits’ in the financial media talking about Bitcoin who haven’t gotten the slightest clue about Bitcoin. This is happening already but will only accelerate. Brace up CNN and Bloomberg.
- Get used to mBTC: Things will be priced more and more in milli-BTC rather than BTC, as 1mBTC will be equivalent to $1. There will be too many zeroes after the decimal point and that can confuse the people buying things in Bitcoin.
- Extensions of the Bitcoin Protocol: Bitcoin isn’t just an ‘internet gold’ or a ‘credit card killer’. It is, first and foremost, a technological revolution and there is absolutely no reason to think that innovation will stall. I predict a number of extensions of the Bitcoin protocol to include more mainstream features like escrow payments, conflict resolutions, N of M signatures, assurance contracts, etc. and also alt-coins that are merge-mined with Bitcoin such as Namecoin was.
- More Push from China: Bigger Chinese businesses will probably be ahead of the adoption curve than the US business. Alibaba will probably start accepting Bitcoins before Amazon does.
- Remittances: At least one serious company will solve the problem of remittances using Bitcoin seriously where it will make the transfer using Bitcoins and will provide and end-to-end service that uses just local currencies but at a much lower fees/rate. A country like Argentina is perfect because it is a good case of ‘balance of payments’ in that there are willing locals who would buy Bitcoin as a store of wealth and workers from other countries willing to remit in Bitcoin.
- Mini-celebrities: The people behind the Bitcoin businesses and developers will get more media coverage and spotlight. Perhaps a Time Magazine cover for Gavin Anderson? The founder of Bitcoin is faceless, but that doesn’t mean the media will not love to create some. Sadly, I doubt it will be the actual developers and probably more clueless self-proclaimed financial pundits but maybe the main-stream media can do something sensible for a change.
- Legislation in US Congress: Bitcoin will be discussed in Congress and laws written around crypto-currencies. It is hard to predict which direction it will take though – whether it will leave room for US innovation or just try to kill it. In any case, it wouldn’t matter too much to Bitcoin as the rest of the world is too important to ignore, whether the US is aboard the ship or not.
What do you think?
Photo Credit: iSchumi
11 Responses to “What Would Happen if Bitcoin Reaches $1000”
Leave a Reply
This site uses Akismet to reduce spam. Learn how your comment data is processed.
What if it reaches a million :O
I think if it reaches a million we’d be living in a fundamentally different world than we live in today, with a few trillionaires walking amongst us! It would be hard to speculate, but let me try that in another post.
Trillionaires :O. I thought there are only 21 million bitcoins in total 😉 😛
Assuming they maintain their BTC positions, Erik Voorhees (evoorhees) and the Winklevoss twins would be worth somewhere between 100 and 200 billion dollars USD. Easily the richest people in the world.
Not really, at $1000 per BTC, they would own 100 to 200 million. Not a small amount, but nothing close to the world’s richest. You’ll need the price to go up much much higher for that
At $1000, yes, but I was answer the parent question: “what if it reaches a million?”
Ah got it, my bad. You’re right 🙂
Sadly for americans I feel that the US Gov will “outlaw” bitcoin adding yet another nail in the coffin for the fall of the US.
The money is starting to leave the US and this is only going to accelerate. Bitcoin will be an excellent method of securing a life away from America.
I’m seriously considering moving to China by 2020.
The Senate hearings weren’t too bad for Bitcoin. Perhaps the country will become more Bitcoin friendly in the future. Besides, China has its own challenges, although the government hasn’t tried to regulate Bitcoin yet. China does have strict currency controls and if the government feels this is threatened by Bitcoin, it may not remain as friendly. Just saying it’s a possibility.
To become a billionaire from an increasing value of bitcoin might not be possible. To be a billionaire one must cash out. If one cashes out that many bitcoin, the value of the bitcoin goes down.
Depends, really, on the market cap of Bitcoin then. Also, we don’t define a billionaire by the liquid cash he holds. If Warren Buffet sells all his stock, the price will fall and he cannot realistically cash out at these prices. Yet his net worth is reported in today’s value dollars.