When we talk about bitcoin, price predictions draw the most attention. These often contradict, some are very optimistic while others remain sceptical. It depends on the variables used for the analysis.

A recent article on Medium released by Harold Christopher Burger explained the long-term price growth of bitcoin based on the idea of modelling bitcoin’s price with power-law.

The article says bitcoin experienced a huge amount of orders in its first years, which was unusual. If the prices from the previous periods are listed in a linear scale, it would not make sense because a linear scale is inefficient for a high-demand asset. It is better to use a logarithmic scale. The logarithmic scaling of the price of bitcoin and the time period from 2009 makes its graph drastically linear over time. Based on the data stated in the article, linear regression was implemented into the graph.

The predictions based on this model indicated that the price of bitcoin would reach USD 100,000 by 2021 and it would not drop below USD 100,000 until 2028.

The most important facts mentioned in the article include volatility. In its initial years, bitcoin was highly volatile but, over time, its volatility has reduced, and its price has gradually increased. The model highlighted the consistently increasing value of bitcoin, although its growth rate is expected to slow down in the coming years.