The billionaire Michael Saylor, the executive chairman of enterprise software provider MicroStrategy (MSTR 2.01%), is a prominent Bitcoin (BTC 1.01%) bull. This view has worked out nicely for him after the world's most valuable cryptocurrency has seen its price surge 151% in 2024 (as of the afternoon of Dec. 17).
Saylor has positioned MicroStrategy to raise equity and debt capital in order to buy Bitcoin aggressively. And he remains incredibly optimistic about the digital asset over the long term, predicting a $13 million price target in 2045.
Here's how much a $100 investment would be worth if the crypto reaches that lofty figure.
Saylor's base case
Saylor, whose net worth is estimated to be about $10 billion, became bullish on Bitcoin in 2020, viewing it as a better place to park capital compared to cash. In August of that year, MicroStrategy purchased the digital asset to put on its own balance sheet. As time passed and the crypto's price continued marching higher, Saylor's conviction became even stronger.
These days, his business can be viewed as a Bitcoin holding company. As of Oct. 30, MicroStrategy owned 252,220 bitcoins, worth almost $27 billion at today's price, which is equal to more than 1% of the asset's entire market cap.
To see the price keep rising is certainly a beneficial outcome for Saylor and MicroStrategy shareholders. And he has never shied away from voicing his opinion.
The base case of the price getting to $13 million in 2045 is built on the assumption that 7% of the world's total asset base -- which includes money in areas like real estate, stocks, and bonds -- will flow to Bitcoin. Right now, that figure is less than 0.2%.
This means that if someone were to invest just $100 in Bitcoin right now, that holding would be worth $12,200 in 21 years if the base case holds true. That's an unbelievable return that translates to a 25.7% average yearly gain.
Saylor's most bullish case predicts 22% of the global asset base goes to the crypto, with a price target of $49 million. That would be a $46,000 value for today's $100 investment. And even in the bear case, he sees the price rising 28-fold to $3 million over the next 21 years. Here, your $100 in 2024 would grow to roughly $2,800.
CRYPTO: BTC
Key Data Points
Predictions are hard
Anytime someone throws out huge numbers like this, it definitely catches everyone's attention. This is doubly true when you consider how lucrative Michael Saylor's belief in Bitcoin has been in the past few years.
However, it's important that investors understand just how difficult it is to make accurate long-term predictions. No matter how smart someone is or sounds, no one knows even approximately what the crypto's price will be in the next week, month, quarter, or year, let alone over the next two decades. There are so many variable factors in play -- like investor sentiment, macro forces, regulatory changes, and technological developments -- that all have an impact.
This is why I think it's best to take Saylor's forecast with a grain of salt. But that doesn't mean the digital token isn't worth a closer look. In fact, I think Bitcoin should be on every long-term investor's radar, particularly those who have a way to go until retirement. The digital gold could be a lucrative asset even if it falls short of Saylor's specific price targets.
The fixed supply of 21 million coins points to its scarcity, something Saylor undoubtedly appreciates. This is an incredibly compelling characteristic for investors looking to store their wealth in an asset that doesn't face significant inflationary pressures. It makes Bitcoin superior to fiat currencies like the U.S. dollar or the euro, which are constantly being debased by central bank activities.
For those new to Bitcoin who are still navigating the learning curve, it makes sense to allocate 1% of a well-diversified portfolio to the digital asset. As your knowledge and understanding of it grow over time, then it's reasonable to increase that allocation to reflect the higher level of conviction you might have.
