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Bitcoin is the most important financial innovation in the past 600 years, according to long-time bull Brian Kelly.
On an episode of the “RiskReversal Media” podcast released last week, the BKCM founder likened the digital asset to the Medici family’s pioneering of double-entry accounting, adding that Bitcoin “automates that all.”
Kelly said that, like every other industry disrupted by software, he anticipated that Bitcoin would disrupt the financial sector.
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“Bitcoin is going to disrupt the financial inner workings as we know it, and the technology behind Bitcoin and the currency behind Bitcoin will be used as this new improved financial plumbing,” he said, when asked why anyone would invest in the digital asset over a stock like Nvidia (NASDAQ:NVDA), which has outperformed it over the past five years.
Beyond touting Bitcoin’s revolutionary potential, Kelly highlighted the asset’s growth potential as a currency-like asset compared to a stock like Nvidia. He said that Bitcoin would continue to grow to meet the needs of the underlying economy.
In the base case that Bitcoin is only used as a substitute for gold, Kelly said the asset still has a 7x growth potential. He arrived at this figure by dividing the market capitalization of gold, estimated to be $15 trillion, by the market capitalization of Bitcoin, estimated to be $2.5 trillion. His reasoning is that Bitcoin can surpass the market cap of gold if it is used as a substitute.
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In actuality, the market capitalization of gold is over $23 trillion at last look, which could suggest an over 9x growth potential. Such a rally would take the asset within touching distance of the $1 million price mark from current levels of about $114,000.
Market analysts have increasingly used gold’s market capitalization as a yardstick to measure Bitcoin’s growth trajectory in recent months, in a sign of the digital gold narrative taking root.
In November, Bitwise investment chief Matt Hougan said investors were still early to Bitcoin until the asset hit $500,000, roughly half the present market cap of gold. He said this was the price of a mature Bitcoin, adding that at minimum it would share the store-of-value market equally with the precious metal.