A new model of supply and demand balance is proposed Bitcoin It may surpass $1 million by January 2027, following current trends in Bitcoin's adoption, liquidity, and reserves.
recent paper By Dr. Murray E. Rudd and Dennis Porter Satoshi Action Education integrates Bitcoin's fixed, inelastic supply schedule and dynamic demand factors, including institutional acceptance and long-term holding behavior, to predict post-halving price paths.
The framework of this model applies fundamental economic theory to the finite supply of Bitcoin and assesses how shifting incremental demand or daily withdrawals to strategic reserves may affect long-term valuations.
The analyzes take into account several parameters such as the amount of Bitcoin has been deleted From currency circulation and the effect of changing demand curves in a 12-year horizon. The results show that even modest daily withdrawals from Bitcoin's liquid supply, combined with growing institutional presence, could drive the price to seven-figure levels in less than three years.
A larger-scale removal of Bitcoin from active trading, combined with increased demand, creates scenarios where the price could reach more than $1 million by early 2027, and tighter liquidity points to even higher levels if adoption accelerates. has
Under more aggressive assumptions about reserves and acceptance, the price could reach $2 million by 2028 and into multi-million dollar territory by the early 2030s if sustained demand growth continues to outpace scarce supply.
Future-Prospective Bitcoin Price Model
This approach is different from traditional statistical models. Instead, it uses fundamentals and treats Bitcoin as a commodity with a supply cap of 21 million coins. Conventional models often focus on historical patterns, while this forward-looking approach is influenced by structural demand changes and strategic accumulation by companies, funds, and independent institutions.
The inelasticity of Bitcoin's supply curve means that incoming demand cannot be met by excess production, potentially leading to rapid price increases and market conditions where small shifts in demand or supply can cause significant fluctuations. This modeling approach also contrasts with energybased on or Network based The models provide a fundamental lens for examining the interplay of scarcity, acceptance, and liquidity.
Practical implications include informing investors and fund managers seeking to understand the relative impacts of policy changes, credit-driven demand, and strategic treasury management on the price of Bitcoin.
The ability to experiment with different assumptions through this framework provides flexibility. Calibration of real-world data can be repeated periodically, allowing decision makers to incorporate emerging trends into their forward-looking asset allocation strategies.
As MicroStrategy and other institutions demonstrate ways to acquire bitcoins through credit enhancements or restructuring corporate coffers, and as governments consider strategic bitcoin reserves, such modeling may be valuable.
Other predictions, such as Power law models which, based on historical data, have presented targets in the seven-digit range in a similar time frame. MicroStrategy's macro-based baseline scenario aligns with a future multi-million dollar Bitcoin. These parallels with external forecasts reinforce the validity of using supply-demand balance modeling as part of a broader analytical tool.
Although early model results suggest conditions that could cause rapid price growth, uncertainty remains about lost coins or permanent holdings, the timing and scale of institutional adoption, and potential regulatory changes.
Modifications to the model may include more accurate representations of demand elasticity or dynamic withdrawal rates associated with dollar-based investments rather than fixed bitcoin values. Incorporating uncertainty through Monte Carlo simulation, scenario analysis, or periodic recalibration can increase realism.
Authors' predictions, available at supplement The data sets present a scenario in which Bitcoin's finite supply faces a future characterized by strategic hoarding and acceptance-driven demand shifts.
Whether institutions and governments are committed to continuous daily purchases or whether acceptance parameters grow linearly or follow a logistic path, this framework shows the inherent tension between fixed supply and increasing demand.
The findings present a long-term investment case with the potential for significant upside and volatility as new market entrants put pressure on the limited supply of the digital asset.
