Macroeconomics expert and investment strategist Lyn Alden made noteworthy assessments regarding the long-term future of Bitcoin (BTC). Arguing that the US’s increasing budget deficits and mon
Macroeconomics expert and investment strategist Lyn Alden made noteworthy assessments regarding the long-term future of Bitcoin (BTC). Arguing that the US’s increasing budget deficits and money supply expansion will continue to support rare assets like Bitcoin, Alden stated that her baseline scenario for 2036 predicts a price of $1 million, while her optimistic scenario forecasts a price of $2 million.
Speaking on the Coin Stories program, Alden stated that structural problems in the global financial system are difficult to solve in the short term, and that investment strategies developed to counter the devaluation of fiat currencies will remain important in the coming years.
When asked about his expectations for Bitcoin’s performance over the next 10 years, Alden said his baseline scenario was around $1 million. In an optimistic scenario, the price could reach $2 million, but given Bitcoin’s size, he didn’t find much higher estimates, such as $10 million, realistic.
Alden added that $500,000 could also be a reasonable outcome for 2036, but Bitcoin needs to continue increasing its share of global assets.
The analyst argued that for Bitcoin to reach $1 million, investors need to understand on a broader scale that the US financial problems are not temporary, but a structural issue that could persist for many years.
The interview also touched upon Bitwise’s 10-year predictions for Bitcoin. When reminded that the company’s pessimistic scenario predicted a price of $130,000, Alden stated that such a price would be an extremely negative outcome for 2036.
According to Alden, Bitcoin trading at only $130,000 after 10 years could indicate that the network is experiencing a serious technical problem, facing coordinated pressure from governments, or that global demand for self-storing, independent digital currency has been lower than expected.
The analyst stated that short-term price movements of Bitcoin should not be given too much importance, but long-term price performance is a significant indicator of network adoption.
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Alden’s long-term Bitcoin outlook is based on his assessments of US fiscal policies.
The analyst noted that budget deficits in the US have reached approximately 7% of gross domestic product, pointing out that a significant portion of government spending consists of social security, healthcare, defense, and debt interest payments. Alden stated that reducing these expenditures is politically difficult and expects budget deficits to persist for a long time.
According to the analyst, with the dollar’s broad money supply growing at approximately 6% annually, it can be misleading for investors to evaluate bond yields solely based on nominal interest rates.
Taking a US Treasury bond yielding 5% as an example, Alden explained that if the dollar supply increased by 6% during the same period, the investor’s relative share of the total money supply would decrease by approximately 1%. He noted that this calculation is not a direct measure of inflation or real return, but it can be used to assess the impact of monetary expansion.
Alden believes this is one of the main reasons why investors are turning to assets like stocks, gold, and Bitcoin instead of staying in cash.
The analyst also stressed that he does not expect large-scale money printing in the near future. Instead, he stated that he adopts a scenario of slower but potentially years-long monetary expansion, arguing that markets have not yet fully priced in the permanence of this structural change.
The security of Bitcoin was also discussed in the interview. Alden stated that artificial intelligence technologies reduce the cost of cyberattacks, but this creates new risks that the cryptocurrency sector needs to consider.
However, the analyst stated that Bitcoin’s relatively simple design provides a significant advantage, noting that complex cryptocurrency projects have a wider attack surface.
Alden stated that he considers the short-term security risks stemming from artificial intelligence to be more significant than the quantum computing threat, but he assesses the likelihood of Bitcoin’s fundamental cryptography being seriously compromised as low.
Alden stated that these risks have not changed his approach to Bitcoin investments, adding that he continues to diversify his portfolio and believes that Bitcoin can remain a significant asset in the long term.
*This is not investment advice.
Continue Reading: Bitcoin Price Forecast from Lyn Alden: She Outlines Scenarios of $1 Million and $2 Million
