Bitcoin price needs to rise to 1.2 million USD? PlanB asserts that a 10x increase is necessary to surpass gold's 22 trillion market capitalization.

The current price of Bitcoin is reported at $115,316, a rise of 40% compared to April against gold, sparking discussions about its pursuit of gold's market capitalization of $22.58 trillion. If Bitcoin's market capitalization is to surpass gold, its price must soar to an astonishing $1.2 million per coin, meaning the current price needs to increase by about 10 times. This article delves into the potential of Bitcoin challenging gold's dominant position, key driving factors, and analysts' perspectives, as well as analyzing the short-term technical trend.

Bitcoin's Market Capitalization Ascent: The Grand Goal of Catching Up to Gold Bitcoin price is trading today at $115,316, having strongly risen 40% against gold (XAU) since April. This strong performance has reignited discussions about whether Bitcoin (BTC) can surpass gold's market capitalization of up to $22.58 trillion. Bitcoin's current market capitalization is approximately $2.3 trillion, and it would be a daunting challenge to leap to $22 trillion. However, if a miracle happens, based on the current circulating supply of about 19.89 million coins, the price of Bitcoin would need to reach an astounding approximately $1.2 million.

The Ultimate Test of "Digital Gold": Can BTC Disrupt Traditional Value Storage? Bitcoin has enjoyed the reputation of "digital gold" for many years, and its loyal supporters firmly believe that it will one day replace gold and become the number one value storage asset. This argument is particularly compelling after observing the continuous strengthening of the BTC/XAU (Bitcoin against gold) exchange rate. The recent increase of over 40% does not immediately indicate a "reversal," but it does show that Bitcoin's appeal relative to gold is significantly increasing. For cryptocurrency investors, Bitcoin's challenge to gold's market capitalization is a key indicator of its long-term potential.

Analyst Perspective: 10x Undervalued and Mining Trends Analyst PlanB expressed on platform X that he believes the market capitalization of Bitcoin surpassing that of gold is not a fantasy. He pointed out that Bitcoin's stock-to-flow (S2F) ratio is about 120, which is twice that of gold (about 60), while the market capitalization of gold is currently only 10 times that of Bitcoin. Based on this model, PlanB asserts that the price of Bitcoin is undervalued by a factor of 10. Interestingly, the rise of Bitcoin has even attracted the attention of the traditional gold mining industry. Reports indicate that gold miner Bluebird planned to sell gold last month and shift to Bitcoin. Even the staunch supporter of gold, Peter Schiff, had to admit the astonishing rise of Bitcoin in the past two months, rare for him to state that BTC is a better asset to hold in the short term, reflecting the subtle changes in sentiment within the cryptocurrency market.

Short-term Alert: Is BTC Price Facing Correction Pressure? The grand narrative of Bitcoin's market capitalization surpassing gold belongs to the realm of long-term price predictions, which may take years to realize. In the short term, technical indicators are signaling a bearish trend. Bitcoin's price dropped today, breaking below the narrow trading range that lasted for three weeks, and fell below the 50-day Simple Moving Average (SMA), putting pressure on the short-term trend. The Awesome Oscillator (AO) indicator histogram has fallen into negative territory, indicating that bearish forces have not yet dissipated. Although the price is testing the previous range support (now turned resistance), if it cannot effectively break through, cryptocurrency traders may face more volatility in the short term.

Conclusion: Bitcoin aims to bridge the huge market capitalization gap with gold, requiring a price surge to hit the milestone of $1.2 million. Even with the continually increasing adoption rates among institutions, this goal will take a long time to achieve. PlanB's model and the shift of some gold miners support the narrative of "digital gold," but technical analysis indicates that there are still risks of a pullback in the short term. While cryptocurrency investors look forward to Bitcoin's long-term disruptive potential, they also need to closely monitor short-term market volatility risks.