The base case model estimates bitcoin could be worth about two point nine million dollars if adoption grows significantly. This framework is not a price target but an exercise to show how bitcoin might be used in the future. The valuation focuses on bitcoin as both a settlement asset and a reserve holding rather than as a trading asset.
The framework assumes that over time institutions and governments might start using bitcoin more. One key idea is that bitcoin could handle a portion of global trade settlement. VanEck models bitcoin taking between five and ten percent of international trade settlement volume. Another idea is that central banks could allocate a small part of their reserves to bitcoin. This would be part of long term diversification away from national currencies. Today bitcoin is not widely used in trade settlement and central banks do not hold it as a reserve.
The framework also considers the challenges that need to be solved. Regulatory clarity and operational infrastructure are required. Political acceptance is needed for adoption to grow. Even with these assumptions bitcoin would likely experience high volatility. VanEck models annualized volatility of forty to seventy percent. This is similar to what is seen in frontier markets rather than traditional financial assets. Even in less optimistic scenarios the framework still expects positive long term returns because bitcoin could gain structural importance over time.
VanEck also highlights macroeconomic factors. Historical price trends show that bitcoin may be more influenced by global liquidity trends than by stocks or commodities. The relationship with the US dollar may weaken over time as global adoption grows. This could make bitcoin a more globally driven asset in the future.
From a portfolio perspective the analysis shows that small allocations of one to three percent of total holdings can improve risk adjusted returns in diversified portfolios. This does not mean bitcoin is low risk. The volatility is high but the overall portfolio impact can be managed if position sizes are limited.
VanEck emphasizes that their framework is a long term exercise. It shows how adoption scenarios could affect value and highlights the factors that need to change for bitcoin to play a bigger role in trade and reserves. The model assumes steady growth in adoption over decades and considers both opportunities and risks.
Overall the framework presents a vision of bitcoin as a more widely used settlement asset and a partial reserve holding for institutions and governments. It shows the potential value under long term adoption but also stresses the uncertainty of this path. Bitcoin could become an important part of the global financial system in the coming decades if adoption grows and supporting infrastructure develops.
