Another way to look at it... $10 invested 14 years ago compounding at 58% annual estimated, but calculated monthly = current price = $27,700 We seem to be coming out of the bottom of a four year cycle. So to compare apples to apples, assume we are coming out of the bottom of the next cycle four years from now. That puts the next near low swing at $267,000. Now, assuming $267k is 70% off the all time high, that would put the next high at $890,000, or 12x the last high. Let's say it takes a year to come back to from the ATH down to $267k. To get to $890k over the next three years, we would need to expect 121% annual, compounding calculated monthly. If we can expect that over the next year, we can expect BTC to be at $88,500, one year from now, almost double off a base value of $48,800. Prolly nothin though.
The first thing you should do is check that you start with correct math. $10 invested 14 years at a 58% rate gives a result of $6,042. Not $ 27,700. So you should rebuild your story completely to get to the optimistic point you wanted to get to. No matter in "which way you look at it", your number is wrong. So the only real numbers you have, to proof your point are already useless. All the rest that follows are hypothetical numbers with assumptions that you don't even proof at all. Where do you get the 4 year cycle? You don't compare apples with apples, as you take real, but wrong, numbers and project that in future without any reasonable explanation why that would happen. You compare (real ) apples with (hypothetical) oranges. As the rest is also based on fictional hypothetical assumptions, this whole post has no value at all. The chart below shows the REAL evolution of the compounded daily return since 2014. The return went from 0.8330% to 0.2885%. That's a 65% drop in return. So that's a constant declining return.What you post is first of all wrong, and also fictional hypothetical. What you do is pump and dump for the idiots. And Johnarb of course gives you a like, without even checking if there is any truth in your post. Or he is too dumb to understand compounding returns. This whole crypto thing has become a religion. And in a religion you should accept all they tell as truthful. Never question what is told to you. Never think critical. And surely never check it with reality.
It does if the estimated rate of 58% annually is compounding, and calculated on a monthly frequency. Bitcoin distribution to miners halves every four years. This is probably the main reason there appears to be a four year cycle between the all time highs, or between the swing lows off the all time highs. Apples to apples means that in calculating growth, we need to compare highs to highs, or lows to lows. There appears to be a low every four years, as well as a high, every four years, for the probable reason stated relative to mining distribution. Every four years the supply of BTC is cut in half. If the demand remains the same, the price should rise significantly. Technically, price should double every four years. It more than doubles every four years, for other reasons, other than the four year halving event. So in calculating future possible price, you have to compare apples to apples. You have to go four years ahead from where we are now. Right now we appear to be recovering from yet another 70+% drop from an all time high (ATH). Apples to apples is: where will we be at the next 70% drop, which should be four years from now, given a four year cycle? It also means the next high should be three years from now, given that the bear markets appear to last about a year.
If the annual rate is 58%, the frequency of calculation is 14 time for 14 years. If you calculate on yearly rates and compounding, you don't care about the frequency of monthly calculations. Show us the formula you use.
Note the "Compound Interval" >> Monthly The Average True Range is an indication of the rate of compounding. The ATR does not wait for a whole year to pass before it increases. Technically, it is increasing daily, but i only estimated it increases monthly. The ATR stays the same (generally linear) in terms of %percentages, but increases (generally exponentially) in terms of $points. 58% compounded monthly produces an "effective annual rate" of 76%, if calculated yearly.
If you speak about yearly returns, the compounded yearly rate of return is 76.195%, not 58%. You should have mentioned 76% instead of 58%.
I emphasized clearly the method i used, twice: "$10 invested 14 years ago compounding at 58% annual estimated, but calculated monthly = current price = $27,700" "To get to $890k over the next three years, we would need to expect 121% annual, compounding calculated monthly." Yes, the "effective annual rate" is 76%. Two ways to arrive at the exact same place. I chose to use a little more granularity to model reality. Projections remain the same.
Bitcoin vs Spot Gold this year so far (fib ret is anchored on H/L but shows space at top on Line on Close chart - though it is correct):-
Today's action on BTC vs. Gold seems to support the tech trade correlation which is my actual thesis. BTC is up 4X vs. QQQ this year and Gold is barely up at all. 72% vs. 16% vs 8% YTD. I think Gold really only goes up for certain when the market senses that the system is in trouble and governments are in trouble. Like when the regional banks & Credit Suisse were in stress Gold skyrocketed. Gold is up 9% since the SVB collapse started but it does look tired and it may roll over soon especially if the First Republic situation solves itself. If BTC were a store of value then countries that have crazy inflation like Turkey, Argentina, Venezuela, etc. would have a lot of flows from local currency and into BTC. I don't know if that is true or not since I don't know how you would track that data.
Gold is hanging in there .... prolly waiting on PCE Core tomorrow morning to decide whether or not to resume uptrend. End of quarter squaring as well.