Boasting a community of over eight million people, eToro is one of the leading global trading and investment platform and it specialises in cryptocurrencies. Although there are more than 1,200 assets to trade on eToro, which was founded in 2007, it is in the crypto space that it is particularly popular. The innovative platform began offering Bitcoin in 2014, and at the time of writing mid 2018 eToro has 10 cryptos available to buy outright. These are as follows: Bitcoin; Bitcoin Cash; Ethereum; Ethereum Classic; Dash; Ripple; Litecoin; Stellar; NEO; and EOS. The motto at eToro is Cryptos Neednt Be Cryptic and the team are always trying to educate users about cryptocurrencies, through blogs, videos and other helpful resources. And to make trading even more straightforward eToro has two pioneering tools CopyTrader and CopyFund that are game-changers for crypto investors of all levels. The first, CopyTrader, allows users to match top traders automatically, and is perfect for those users who are unsure about what cryptos to invest in. Over time, and by monitoring the top traders strategies, eToro clients can build up their trading experience and confidence. The second allows users to diversify their portfolio

Boasting a community of over eight million people, eToro is one of the leading global trading and investment platform and it specialises in cryptocurrencies. Although there are more than 1,200 assets to trade on eToro, which was founded in 2007, it is in the crypto space that it is particularly popular. The innovative platform began offering Bitcoin in 2014, and at the time of writing mid 2018 eToro has 10 cryptos available to buy outright. These are as follows: Bitcoin; Bitcoin Cash; Ethereum; Ethereum Classic; Dash; Ripple; Litecoin; Stellar; NEO; and EOS. The motto at eToro is Cryptos Neednt Be Cryptic and the team are always trying to educate users about cryptocurrencies, through blogs, videos and other helpful resources. And to make trading even more straightforward eToro has two pioneering tools CopyTrader and CopyFund that are game-changers for crypto investors of all levels. The first, CopyTrader, allows users to match top traders automatically, and is perfect for those users who are unsure about what cryptos to invest in. Over time, and by monitoring the top traders strategies, eToro clients can build up their trading experience and confidence. The second allows users to diversify their portfolio

Reading:Bitcoin Cash (BCH) Disappoints with Empty Blocks

How can we determine at what price point will Bitcoin match the total money supply value of global reserve currencies and the market cap of precious metals such as gold?

First off, a disclaimer. Definition of market cap:

Market capitalizationis the market value of a companys outstanding shares. This figure is found by taking the stock price and multiplying it by the total number of shares outstanding. Investopedia

Bitcoin is not a company. There are no shares in Bitcoin. It does not have a stock price. It does not have a market cap.

Bitcoin is money. It makes as much sense to talk about the market cap of Bitcoin as it does to refer to the market cap of the dollar. The dollar and Bitcoin have Money Supplies (MS). It is best to analyze their markets using classical comparative-static Monetary Economics. The Supply of Bitcoin is perfectly inelastic (vertical Supply curve). Supply increases by 12.5 Bitcoin (curve shifts right) every 10 minutes. The Demand for Bitcoin is a Demand for Money.

Having got that out of the way, the terms Money Supply and Market Cap will be used interchangeably. All data is from the authors . Live prices feed into Google Sheets from Google Finance. Where Google Finance prices are unavailable, prices are taken from Bloomberg.

Soon Ill be able to pay $1,250 in paper for (1) a solid ounce of fine gold, or (2) some electrons called bitcoin. Hmm, tough choice.

Jim Rickards (@JamesGRickards)February 25, 2017

/SGKinsmann (@BambouClub)February 25, 2017

For Bitcoin to reach the same market cap as Gold, the required price is $500,000. (That is half a million dollars for Europeans confused by the comma sign.)

For Bitcoin to reach the same market cap as Silver, the required price is $2,588.

The Bitcoin Price is close to matching that of an ounce of Gold but, of course, the supply of Gold (measured in USD) is much greater. This is an old but a good tidbit on this subject:

At current prices, if Gold holders divest 1% into Bitcoin, the price of one bitcoin would be$5,002.

Some analysts falsely claim that Bitcoins market cap has already exceeded that of Silver.

Bitcoinnow has a larger market capitalization than silver,@ Thanks for the data

Simon Dixon (@SimonDixonTwitt)December 23, 2016

It was pointed out to Dixon that he was selling snake oil. He did not correct the false information he distributed, which is a worrying trait.

Shaft Gunk (@shaftgunk)January 3, 2017

Last word on Bitcoin and Gold. Bobby Lee makes some interesting observations about the mining of Bitcoin and Gold in China.

In 2016,China🇨🇳 was the largest producer of BOTH:

Bitcoin(~700,000BTC, ~$800 million USD today)

Bobby Lee (@bobbyclee)February 24, 2017

Coincidentally, this yearChina🇨🇳 will mine 1BTCfor every 1 KG ofGoldthey mine, almost exact 1:1 ratio!Bitcoinvalue = 1 KG gold?🤔

Bobby Lee (@bobbyclee)February 24, 2017

How do you measure the market cap of a currency? For a fiat money like the dollar, the narrow M1 Money Supply is the total stock of liquid spending power in the economy: cash (banknotes & coins) held by consumers and firms plus money in checking accounts in banks. (What Europeans call current accounts.) It excludes less liquid, broad money, notably money held in time-deposits (savings accounts).

I sourced data for Global Money Supplies measured in Local Currency fromTrading Economics. Then Live FX rates are used to adjust those Money Supplies to their equivalent USD values.

Bitcoin Money Supply was 41 in global rank on 1 Jan 2017. Now 34.

21.co/SGKinsmann (@BambouClub)February 25, 2017

Why is the MS of Bitcoin climbing the table of Global Money Supplies? The MS of Bitcoin measured in USD is determined by the increased availability of Bitcoins due to mining and by changes in the BTC/USD change rate. The latter factor is the dominant one as the physical supply of Bitcoins increases very slowly currently 4% p.a. and decelerating. N.b. this isnotmonetary deflation, it is declining monetary inflation.

USD M1 changes over time. Usually, it grows much more quickly than the supply of Bitcoin (measured in BTC) and, very rarely, decreases.

The MS for Bitcoin presently is 16.183 million (coins). It will rise to a maximum of 21 million. That is a total growth, spread over many years, of a touch less than 30%. To place that in perspective, the supply of Dollars often grows 1520%annually.

We nevertheless expect the MS of Bitcoin measured in USD to continue to climb the table as a result of the relentless increase in the BTC/USD FX rate. You know the story, the best-performing currency in 2010, 2011, 2012, 2013, 2015. 2016 (and YTD 2017):

/SGKinsmann (@BambouClub)February 25, 2017

A Reserve Currency is a one that is held in significant quantities by governments and institutions as part of their foreign exchange reserves. Reserve currencies are commonly used in international transactions as trading partners are unwilling to accept your Mexican Peso or Egyptian Pound. Reserve Currencies are normally considered to be hard or safe-haven currencies. (Although the recent weak performance of  GBP does not support that.)

Currency Composition of Official Foreign Exchange Reserves 2016 (COFER)

Currency composition of Official Foreign Exchange Reserves 2016 (COFER)

21.co/SGKinsmann (@BambouClub)February 25, 2017

MS of Bitcoins vs. Official Reserve Currencies: USD, GBP, JPY, CAD, AUD, CHF. Plus Gold, CNY. EUR excluded.

21.co/SGKinsmann (@BambouClub)February 25, 2017

The Reserve Currency with the smallest MS is the Canadian Loonie. Bitcoin needs to reach a price of$3,904to match the Money Supply of CAD. That could happen in the next one or two years.  This is important status as a Reserve Currency creates a significantadditionaldemand for that currency independent of other sources of demand, such as for payment and for investment. So if the Pound Sterling was not a Reserve Currency, for example, its international buying power would be much weaker.

Changes in FX rate of All Reserve Currencies vs. USD YTD 2017. Plud, Gold, China, Bitcoin.pic.twitter.com/oi8JbltaqV

21.co/SGKinsmann (@BambouClub)February 25, 2017

Bitcoins performance against all the Reserve Currencies is important and it is mistaken to focus solely on BTC vs. USD.

Canbitcoinreach world reserve currency scale? Bitcoins exponential growth rate shows us its one of the possible outcomes in 10yrs.pic.twitter.com/PzlL4hdbtk

Willy Woo (@dangermouse117)February 17, 2017

Finally, it is evident from the MS table that something very interesting is happening inSwitzerland. They love cash.  These economies have the worlds largest Narrow Money Supplies.

Switzerland M1 Narrow Money (Cash in circulation) is 5x GBP M1; Swiss economy is a quarter of size of UK economy.

21.co/SGKinsmann (@BambouClub)February 18, 2017

UK population (64 m.) is 8 x Swiss population (8 m.).

21.co/SGKinsmann (@BambouClub)February 18, 2017

So, the Swiss Government enables its citizens to hold cash. Add to that the facts that Switzerland is the wealthiest nation in the worldper capita, and that they have one of the highest rates of gun ownership in the world (and they sell Bitcoins at every Railway Station) I wonder why everyone else does not just copy and paste what Switzerland does. It would not surprise me if they start to buy Bitcoin for their reserves.

In fact, Civic CEO, Vinny Lingham,made this exact predictionlast year, saying:

My prediction here is that by 2017, governments will become the largest buyers of Bitcoin, pushing the price up to new highs.

This is the first in a two-parter. The second part will deal with comparisons of Bitcoin market cap withthe FANGs and other iconic global stocks and stock indices. Stay tuned!

Correction: we are informed by Simon Dixon that Max Keiser has no part in BnktotheFuture.com .

@BambouClubThat was a great article you shared. There is an inaccuracy to adjust as Max Keiser is not part of BnkToTheFuture. Please update

Simon Dixon (@SimonDixonTwitt)February 27, 2017

Bitcoin Capital Crowdfunds $1m+ on BnktoTheFuture.com. Max Keiser & Simon Dixon to Manage New Fund.

BitStarz Player Lands $2,459,124 Record Win! Could you be next big winner?

For updates and exclusive offers enter your email below.

I consent to my submitted data being collected and stored

bitcoin is a cultural movement. bitcoin is for people. bitcoin is about principles. or at least, this is the proposition that CoinShares Chief Strategy Officer, Meltem…

Many analysts over the years have said that bitcoin is a speculative bubble, comparing it to tulips or beanie babies. However, BTC is still here and doesnt look to be going…

The market for CME Bitcoin futures shrank to its lowest level in four months, with volumes about 50% lower than peak activity in July. The futures market behavior was viewed as an…

Follow Bitcoinist on social media to keep up-to-date with the latest news!

We use cookies to give you the best online experience. By agreeing you accept the use of cookies in accordance with our cookie policy.