Sr. Fintech Consultant, BTC, Blockchain, Cybersecurity, Artificial Intelligence
John McAfee has been quiet for a while, but unsurprisingly as bitcoin has rallied, he has stuck his head above the parapet again with yet another grandiose prediction about the price of bitcoin.
This time he is really sticking his neck out and is saying that by the end of 2020 it will reach $1 million. Considering it is sitting at just under $5,600 at the time of writing, it seems rather wild to think it could reach the one million mark in just over 18 months.
McAfee doubles down on $500,000
Indeed, McAfee has doubled down on his 2017 estimate, in which he claimed it would be worth $500,000 in 2020. So how has he come to his most recent conclusion about Bitcoin’s price? And, by the way, he also said that if it didn’t reach $500,000 by 2020 he would “do something that none of us would probably want to see,” as Harsh Chauhan recounts at CCN. What he actually said, or rather tweeted, which I may have mentioned in one of my previous blogs, is that he would eat his d**k on national television. Chauhan is right; who wants to see that?
McAfee claims it is “impossible” that Bitcoin won’t reach $1 million by the end of 2020 because of the maths. And here is what he actually tweeted: “Come on people!!! It’s time to brush up your basic math skills and run some f*^#$ng numbers!!!! It is mathematically impossible for Bitcoin to be less than $1 mil by the end of 2020. Bitcoin is not an effing stock!!! You can’t apply stock paradigms or formulas and expect answers!”
Nobody so far seems to sure what numbers McAfee ran to arrive at his eye-watering Bitcoin price, although there are surely many people out there who own Bitcoin hoping he is a mathematical genius.
Let’s not forget where Bitcoin is at the moment and how it got to its current price. It fell in value by $17,500 to reach $3,800 in December 2018 after its meteoric rise in 2017. In December 2017, it looked like the only way was up for Bitcoin, but that proved to be very wrong.
McAfee made his first $1 million prediction during the extraordinary 2017 bull run. On 29th November 2017 he tweeted, “When I predicted Bitcoin at $500,000 by the end of 2020, it used a model that predicted $5,000 at the end of 2017. BTC has accelerated much faster than my model assumptions. I now predict Bitcoin at $1 million by the end of 2020.”
At the time, some industry insiders like Craig Wright said, ““Bitcoin from John is BTC + BCH. I think people are missing this.” Indeed, McAfee has been a strong supporter of Bitcoin Cash (BCH) in the past and he has stated that he believes BTC and BCH will ultimately fight a war for the “Bitcoin” name.
However, at no point, not then and not now, has McAfee ever explained what kind of maths he is using to arrive at his figures. When his predictions are questioned he generally retorts, as he did in 2017, with something along the lines of ““Bitcoin can reach a million and still not be dominant. Did all of you get hit in the head as a child?”
McAfee is not alone in his predictions
Then again, McAfee is not alone in making big claims for the Bitcoin price. Wences Casares, CEO of Xapo, thinks there is at least a 50% chance that Bitcoin will reach $1 million in the next seven to 10 years. He claims the future Bitcoin price can be arrived at by multiplying $7,000 by the number of people owning Bitcoin. This calculation rests on the assumption that this constant is maintained and that there are 3 billion people owning Bitcoin. In his calculation each unit of the cryptocurrency will be worth $1 million as the supply of the cryptocurrency is fixed at 21 million units.
Well, first we have to get from around seven million people owning Bitcoin to three billion, and that’s a hell of a jump.
Unless we see mass adoption skyrocket this year and next, it is impossible for McAfee’s prediction to come true, because the numbers just won’t add up. You may either hope it does happen so that you profit from owning Bitcoin, or so that you won’t have to watch him do something unmentionable on TV.