Crosby referred to the current market situation as “the textbook example of seller fatigue.” Bitcoin has encountered a series of unfortunate events:
- the Coldcard vulnerability
- the postponement and subsequent rejection of the CLARITY Act in the Senate
- miners divesting Bitcoin in favor of AI investments
- treasury firms liquidating their assets
Despite this, the price continued to surge. Supply from long-term holders has begun to decline, which Crosby interprets as a sign that fresh capital is entering the market.
He does not observe any indications of a market bubble. Instead, he describes a “healthy, very spot-driven movement” of funds shifting from stocks, bonds, and commodities into Bitcoin.
Reasons Behind Bitcoin’s Rapid Movement
Crosby highlighted the rapid ascent of Bitcoin, which jumped from $64,000 to $84,000 in a short period. Since long-term holders possess a substantial portion of the supply and seldom sell, each new dollar entering the ecosystem increases Bitcoin’s market valuation by approximately $6.20, according to his analysis. Thus, even a minor reallocation of capital from an AI bubble or fixed income market could result in a notable price increase.
Bitcoin’s Share of Global Investments
At approximately $87,000, Bitcoin constituted around 0.32% of the total global capital investment, falling short of its peak of nearly 0.5%. Given the continuous growth of global capital, Crosby noted:
- Returning to its previous peak share could elevate Bitcoin to about $134,000, surpassing its all-time high of $126,000.
- 1% of the global capital would value Bitcoin at roughly $281,000 today, potentially exceeding $500,000 within a decade.
- 3% of global capital could imply a price around $1.75 million over the next ten years.
Comparing with Silver: $400,000
Crosby’s most ambitious scenario draws a parallel between Bitcoin and silver. When silver hit its low point in 2022, its market cap was about $1 trillion, while Bitcoin’s recent low stood around $1.1 trillion.
Silver experienced an increase of approximately 593% over 3.4 years. Given Bitcoin’s 24/7 trading nature, Crosby adjusted this timeframe to roughly 2.3 years. If Bitcoin replicates the trajectory of silver during that span, it could reach about $400,000.
He mentioned that Bitcoin has exhibited a correlation of approximately 90% with silver’s movements thus far. While he acknowledged that this target may be “potentially” optimistic and refrained from predicting an exact peak, he indicated that a global capital model suggests a figure close to $390,000.