Who remembers investing the first $100 in Bitcoin a few years back? Many found memories of that very first transaction and the feeling of excitement afterward. Investors started projecting different Bitcoin price jump scenarios and made plans on what to buy with those mouth-watering returns.

Recent volatility shows how important it is to keep feet on the ground and constantly remind that the most significant potential comes from long-term holdings. Recently more and more $500,000 to $1,000,000 Bitcoin price forecasts are flying left and right, but the question is, how realistic are those?

Bitcoin price forecasts

Considering the Bitcoin price momentum of 2021, the $100,000 mark doesn't seem so out of reach. The question here is more about when this will happen rather than if.

Looking beyond that mark, Anthony Scaramucci, founder of Skybridge Capital, sees Bitcoin hitting $500,000 per coin. Not only does Ark Investment's Cathie Wood echo similar sentiments, but she also sees it happening in the next five years. 

Anthony Pompliano, co-founder and partner at Morgan Creek Digital Assets, sees Bitcoin hitting $500,000 by the end of the decade and eventually reaching $1 million per coin. So does Samson Mow, chief strategy officer of Blockstream. But, more importantly, he thinks such a forecast is feasible in the next five years. Raoul Paul, a former Goldman Sachs hedge-fund chief, also shares the same vision.

And if you think this is ambitious, you haven't even heard about Fidelity's model that sees Bitcoin top $1 billion by 2038, dwarfing any other forecast.

While this might seem like the perfect future for crypto investors, the reality is that Bitcoin's all-time high sits at $68,521. This is not a bad thing, just the opposite – a while back, it was just a wild dream. However, for these overly optimistic scenarios to materialize, it will take for Bitcoin's ATH to make a 7x to 14,500x jump. This naturally leads to the million dollar question: Is the billion dollar Bitcoin realistic or wishful thinking?

Unfortunately, Bitcoin's price is complicated to predict. However, it is possible to determine the triggers that can unleash such a rally with certainty. Market history and basic economic theory suggest the most-probable ones include:

Bitcoin going mainstream

The most significant enabler for a price rally is having cryptocurrencies take a primary role in our day-to-day lives and as the main payment medium. In addition, crypto-related consumer products like NFT-marketplaces, crypto day trading platforms and the approval of the first Bitcoin ETF paint a clear picture that the crypto world is here to stay. 

A big push regarding growing the network of Bitcoin users and having more people join the crypto world can solve the problem of the unbanked population – something that the conventional financial system had failed to do.

Fidelity's model that predicted a $1 billion price by 2038 accounts for just that by basing the forecasts on Metcalfe's Law. It states that the value of a network (in that case, the Bitcoin price) increases geometrically with the linear growth in the number of users.

Even though, for Bitcoin to go mainstream, we will need to increase the financial literacy across the general population and build a welcoming digital market infrastructure that allows for affordable and accessible crypto transactions.

Fortunately, the prospects for mainstream adoption are looking brighter and brighter each day. According to some experts, crypto technology is adopted faster (113 per cent) than internet technology before (63 per cent).

More welcoming regulations

Thanks to the positive developments on the regulatory front, Bitcoin is now closer than ever to being recognized as a traditional asset class. In addition, El Salvador recently made bitcoin legal currency, with Panama and Ukraine looking in the same direction. The US and the EU regulators are also reeking positive sentiment towards the crypto industry but more subtly.

While much work remains to be done, the last five years have seen tremendous yet well-managed progress. While many crypto investors might consider it insufficient or too slow, the truth is, those who think regulators should rush to embrace crypto overnight don't know what they wish for. 

The often cautious approach of regulators towards the crypto industry and their tendency to take things slowly allows for a more sustainable adoption that preserves the financial system's stability. 

Taking the process one step at a time is an excellent way to position the crypto industry for future growth. And as the oversight authorities' perception of the crypto economy continues to warm, we have all the means to believe in those optimistic price forecasts.

Eco-friendly mining

One of the main objections against it is excessive electricity consumption. Annually, Bitcoin mining consumes more electricity than countries like Norway, Switzerland and Bangladesh.

In a world marching towards a net-zero economy, Bitcoin's case for becoming the asset of the future simply won't have ground unless renewable sources power its mining. Once this happens, the cryptocurrency will find legitimacy way easier, even from the most conservative parts of the market. Fortunately, the chance is we are just a few regulatory steps away from making cryptocurrencies ‘clean.’

Furthermore, if Bitcoin goes ‘green,’ it will win yet another battle against fiat currency. Currently, fiat money requires maintaining thousands of bank branches, employees using fossil-fuel-based transport and over 3.5 million ATMs worldwide. All this soaks power 24/7.

Wrap up

It is critical to understand that the most significant price rally in Bitcoin's history wouldn't result from a single factor but instead of a combination of favorable developments. So, how to identify them? 

They all have in common their goal – to make Bitcoin the global reserve currency. The moment Bitcoin makes a move from that hipster-ish antagonist of the conventional financial system to an arm that extends it and addresses its flaws, we will talk of these prices no more as just forecasts but as market history instead. 

Disclaimer: The information provided in this article is being provided solely for marketing and informational purposes and should not be construed as investment or legal advice.