Over the course of its 15-year history, Bitcoin (CRYPTO: BTC) has made plenty of millionaires. In fact, data from the blockchain analytics platform Glassnode shows roughly 115,000 wallet addresses with a balance of more than $1 million today.
But what are the chances you could one day join this select group? For the patient and long-term investor, the answer might surprise you.
A quick glance at Bitcoin's price over the years shows that the most explosive gains were made in its early days. From 2009 to 2012, the world's original cryptocurrency jumped from less than a tenth of a penny to more than $5, an absurd 710,000% increase. With Bitcoin trading for around $65,000 today, an investment of just $75 when it was worth roughly $5 would have been good enough to make you a millionaire.
As surprising as it may sound, there is still plenty of opportunity for the world's original cryptocurrency to create millionaires, even if the days of it trading for less than $100, let alone $10,000, are likely gone. There are complex simulations and intricate theories that can be useful in capturing Bitcoin's future millionaire-making abilities, but some simple math can do the trick, too.
Bitcoin's performance is often analyzed in relation to its halvings. Occurring approximately every four years, these halvings reduce its inflation rate by half and serve as easy landmarks to break Bitcoin's existence into natural cycles.
One notable observation found by Bitcoin analyst Willy Woo is that holding Bitcoin for at least one halving cycle, or roughly four years, has never resulted in a negative return. Over this period, Bitcoin has shown an average annualized return of 30%. In other words, even if investors bought at the peak of a bull market, as long as they held for at least four years, they would eventually see a 30% annualized return.
For those considering #Bitcoin. Remember to hold for 4 years. It's never returned below 30% annualised for a 4 year investment, no matter how badly timed...BTC: 30-60%, 75% drawdownsSP500: 10%, 35% drawdownsReal Estate: 10%, 30%+ drawdownsVC Funds: 15%-27%, 10 year lock up
While this is a lower-bound scenario, we can use it as a baseline to show what it takes for investors to become Bitcoin millionaires. Assuming an annualized return of 30%, one would need to invest roughly $85,500 annually for five years to hit millionaire status. Over 10 years, this number falls to around $18,250. For a 20-year period, you would only need to invest a mere $1,225 per year.
If you expand your viewpoint beyond the four-year mark, the potential for wealth creation magnifies considerably. Considering Bitcoin's average annual return over its entire history (not just a four-year halving cycle) is roughly 170%, the timeline accelerates, and the required investment amount decreases significantly.
The opportunity is today
It's crucial to acknowledge that past performance doesn't guarantee future results. However, the fundamental numbers behind Bitcoin remain immutable. At its core, Bitcoin's value proposition revolves around one key figure: 21 million.
With a finite supply of 21 million Bitcoins and the ongoing reduction of Bitcoin's issuance rate through halvings, supply and demand dynamics increasingly favor price appreciation over time.
As investors, understanding and embracing these fundamental principles of supply and demand provide a solid foundation for navigating market volatility. While short-term fluctuations and speculative trends may influence prices, the long-term trajectory of Bitcoin's value is anchored in its scarcity and increasing utility. With each halving, the scale tips further toward sustained price growth, presenting a compelling opportunity for hopeful millionaires.
RJ Fulton has positions in Bitcoin. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.
The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY.
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While this is a lower-bound scenario, we can use it as a baseline to show what it takes for investors to become Bitcoin millionaires. Assuming an annualized return of 30%, one would need to invest roughly $85,500 annually for five years to hit millionaire status. Over 10 years, this number falls to around $18,250.
At the time he made those comments, the price of Bitcoin was around $35,000. So, 10 times from those levels would mean that Bitcoin could go as high as $350,000, Saylor said. If this is the case, you would need to own 2.86 BTC to become a millionaire. It would cost around $190,000 today.
Prominent figures associated with substantial cryptocurrency wealth include individuals such as Changpeng Zhao (founder of Binance), Cameron and Tyler Winklevoss (founders of Gemini), and Chris Larsen (co-founder of Ripple). Their fortunes are tied to successful ventures in the crypto space.
Add it all up, and Wood foresees Bitcoin's market cap reaching more than $20 trillion in the future, good enough to send the price of each Bitcoin well past the $1 million mark.
There are 88,200 crypto millionaires worldwide. 40,500 of these millionaires have amassed their fortune in Bitcoin (BTC). The number of global crypto owners reached 580 million by the end of 2023, according to Crypto.com.
While it is possible to become wealthy by investing in Bitcoin, it is not a guarantee, and there is always the risk of losing money as well. Some people have made significant profits by investing in Bitcoin.
If you invest $100 into Bitcoin today, don't expect to make a fortune. However, you could still make some solid gains if your bet on Bitcoin pays off. Many people who are interested in crypto would like to get started with smaller amounts, which is entirely reasonable given that cryptocurrencies are risky investments.
That investment would be worth $6,859,178,076.22 today based on the same price of $28,122.63 at the time of writing. While investing in Bitcoin today may never be worth billions of dollars in the future, the hypothetical investment illustrates the large increase in value of the leading cryptocurrency over time.
As Bitcoin goes increasingly mainstream, it is drawing the attention of more billionaire investors. Mass buying by billionaires could lead to a supply squeeze, sending the price of Bitcoin soaring. As billionaire hedge fund managers boost their exposure to Bitcoin, it could lead to unpredictable outcomes.
Out of all 210 million Bitcoin users, the report says only six are Bitcoin billionaires. That is, six individuals hold at least a billion dollars in bitcoin each. 78 Bitcoin users are centimillionaires, which means that those individuals each hold at least $100 million worth of Bitcoin.
A $100 investment in Bitcoin could purchase 0.00607 BTC today based on a price of $16,466.14 at the time of writing. If Bitcoin hits the $1 million price target by Wood in 2030, the $100 investment would turn into $6,070. This represents a gain of 5,970% from now until 2030.
It is theoretically possible. Bitcoin has been around for close to 15 years now, and although it has survived several dramatic crashes before making new highs, its extreme volatile nature puts investors at risk of losing all their money.
For the third year running, Changpeng Zhao, founder and former CEO of crypto exchange Binance, is crypto's wealthiest person. Despite pleading guilty to U.S. money laundering charges in November, CZ, as he's known, is now worth an estimated $33 billion, up from $10.5 billion last year.
Binance founder and CEO Changpeng Zhao (commonly known as CZ) was the crypto billionaire who lost the most money following the crypto crisis of 2022, with a net worth drop amounting to 82 billion U.S. dollars.
The report, cited by Bitcoinist, suggests that 29% of millionaires have a “high degree of interest” in entering the cryptocurrency space as investors while another 27% “sit on the fence.” Altogether, then, a full 56% of HNWIs are either prepared to invest in digital currencies now or could likely be swayed to do so in ...
Up a level, there are 182 centi-millionaires, holding at least $100 million in cryptos, and there are 22 crypto billionaires. Bitcoin accounts for more than half of crypto-millionaires fortunes while 72 of the centi-millionaires and six of the crypto-billionaires made their fortunes from trading Bitcoin.
Who owns the most Bitcoin in the world? The top Bitcoin holder is still believed to be Satoshi Nakamoto, the anonymous creator of Bitcoin, who reportedly holds around 1.1 million BTC across many wallets. Despite this large holding, the top 10 holders collectively only possess about 5.5% of the total Bitcoin supply.
However, some estimates can be made based on blockchain data and surveys of Bitcoin holders. According to data from Bitinfocharts, as of March 2023, there are approximately 827,000 addresses that hold 1 bitcoin or more, representing around 4.5% of all addresses on the Bitcoin network.
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