Bobby Lee, the co-founder of BTCC and the brother of Litecoin creator Charlie Lee, has recently made a bullish case for bitcoin, the flagship cryptocurrency, as he sees its price surpass $60,000 by 2020 after the block reward halving.
Through various tweets the entrepreneur revealed he believes that as BTC’s price hits $60,000, its total circulation value will be of over $1 trillion which will in turn see its price become more stable thanks to higher global liquidity.
When #Bitcoin passes the USD $60,000 price level in the coming years, it‘ll reach a total circulation value of $1 Trillion. That will be a huge #milestone for $BTC, and it‘ll lead to more price stability, higher global liquidity, and even faster adoption worldwide. #VirtuousCycle— Bobby Lee (@bobbyclee) August 24, 2018
His prediction seemingly implies breaking the $1 trillion mental barrier will help the cryptocurrency surge to new highs well above $60,000, as most institutional investors will then be investing in the cryptocurrency thanks to its liquidity.
Lee’s initial prediction wasn’t well received on the microblogging website as various users pointed to flaws in his theory. Some argued, for example, the cryptocurrency’s price is determined by supply and demand, not its network’s effects.
Responding to the critics, Lee stated:
#Mining & #BlockReward explains why #Bitcoin prices will go up: When I started in 2011, daily global output (new BTC x price) was at $36,000. In 2015, this went to $1.8m. Today, we are at $12m. It means that globally, hashpower keeps going up, using up to $12m electricity costs.
Using up this much electricity, he added, isn’t a downside as the cryptocurrency uses a proof-of-work (PoW) consensus algorithm, which helps ensure its decentralization, which means it’s even safer with the added hashpower.
The entrepreneur went on to add that after the next block reward halving in the spring of 2020, bitcoin’s output will drop to 900 BTC/day. If the network’s hashpower keeps rising, electricity costs could reach $54 million per day, he said, leading BTC to $60,000.
He then compared his case to that of gold mining. In 2017, Lee said, 3,150 tons of gold were mined, meaning its daily output was of 8,630 kilograms. At today’s price that equals $335 million of gold per day. The gold mining industry, he asserted, is spending less than that every day.
#BitcoinMining industry is at just $12 million/day, compared to $335m/day for #GoldMining industry.— Bobby Lee (@bobbyclee) August 26, 2018
I predict #hashpower will continue to grow for #Bitcoin with daily $ numbers increasing.
Once global daily output reaches $54m in 2+ years, that would give $BTC a price of $60,000.
Further responding to critics who claimed BTC would never surpass $10,000 again, Lee invited them to bet on it and to check back with him in three years. Notably Tom Lee, a well-known bitcoin bull and the founder of Fundstrat Global Advisors, has also recently made a bullish case for the cryptocurrency.
As CryptoGlobe covered, Tom Lee argued a relatively unknown correlation between BTC and emerging markets may see bitcoin end the year “explosively higher.” He maintained his $25,000 by the end of the year price prediction.
At press time bitcoin is trading at $6,700 after falling 0,8% in the last 24-hour period. BTC has seemingly been rising since August 11, when it slipped below the $6,000 resistance.