# Bitcoin at \$933,333 According to This Measure

 By Chris Coney

Two weeks ago, I published an article entitled “A \$140,000 Bitcoin Price Target.”

That was a fun article designed to expand your perspective on Bitcoin (BTC, “A-”), the price levels it could potentially achieve and why.

This week I’m going to dial it up even further and show you how you can mathematically determine Bitcoin’s price today to be \$993,333.

Yes, that’s almost \$1 million per Bitcoin.

Now you may disagree with the way I am about to put the numbers together, but what you cannot deny is this.

If you do put the numbers together in this way, you get 1 BTC = \$993,333.

## Everything Divided By 21 Million

In the conclusion of my aforementioned article, I quoted an axiom used in the Bitcoin community that determines Bitcoins value to be “Everything divided by 21 million.”

This is derived from the fact that Bitcoin is the only commodity known to man to have a fixed supply.

People make that argument for gold, but gold is only relatively scarce — i.e., there’s only so much of it in the ground on planet Earth.

Once SpaceX decides to start mining gold from asteroids, the scarcity of Gold completely vanishes.

By contrast, Bitcoins scarcity is not limited to planet Earth.

Bitcoin is not relatively scarce; it is absolutely scarce.

No matter how far out into the cosmos you go, the supply of Bitcoin will never exceed 21 million.

That is why we say the value of Bitcoin is “Everything divided by 21 million.”

## Why Bitcoin Is Already Worth Almost \$1 Million

We’ve established that the max supply of Bitcoin is 21 million coins.

As I wrote in my previously aforementioned article, this established the world's first (and so far, only) economic constant.

Now let’s add in another economic concept: unit of account.

The unit of account in economics basically translates to “what we price stuff in,” or more simply, the currency.

In the United States, the unit of account is U.S. dollars because “that’s what stuff is priced in.”

When Bitcoin was invented and touted as a currency, there was an expectation that Bitcoin would become a unit of account — i.e., you’d go into the grocery store and find the shelf edge labels displaying the price of bananas in BTC.

That may happen one day. But it is a long way off.

So for now, the USA continues to use the U.S. dollar as the unit of account, the U.K. uses the British pound and so on and so forth around the world.

If the supply of Bitcoin is 21 million, and U.S. dollars is the unit we price everything in, what is the total supply of U.S. dollars?

Meaning, how many U.S. dollars are in circulation?

This is a measurement that is tracked by the Federal Reserve and is referred to as M2.

According to Investopedia:

“M2 money supply is a measure of the total money supply that includes cash, checking deposits and other types of deposits that are readily convertible to cash such as savings deposits, money market funds and small-denomination time deposits.”

Also according to Investopedia: “The M2 was \$21.1 trillion in March 2023.”

So, if you divide \$21.1 trillion by 21 million Bitcoin, you get a price of \$1,004,761.90.

That means, as of March 2023, there was over \$1 million circulating for every 1 Bitcoin.

M2 supply has come down a bit since then to around \$20.86 trillion today.

If you divide \$20.86 trillion by 21 million, you get a Bitcoin price of \$993,333.

If M2 were a pool of water and Bitcoin were a sponge, that is how much Bitcoin’s value would have to expand to absorb it all.

So from that point of view, Bitcoin is grossly undervalued.

But that’s all I’ve got for you today. Let me know what you think about this topic by tweeting at me.

I’ll catch you here next week with another update.

But until then, it’s me, Chris Coney, saying bye for now.

About the DeFi & Crypto Educator

Chris Coney is among the world’s most experienced educators in the field of decentralized finance (DeFi) and cryptocurrencies. He is also one of the few analysts in the world specializing in the field of “yield farming” — hunting for the high yields now possible in the fast-growing DeFi world — and showing others how they can do the same.

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