# Bitcoin 2020 At One Million, Is This Really Realistic?

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According to John McAfee, the Bitcoin price is set to rise to one million by the end of 2020. The well-known crypto-evangelist is so sure that he puts his best piece on this claim. But is this really realistic?

Undoubtedly, John McAfee is one of the more colorful personalities in the crypto-ecosystem. The founder of McAfee Associates has been a talk of interest in cryptocurrency, but his interest in Bitcoin and other Altcoins has given him a special presence. Just over the last few years, he has attracted attention with controversial applications of various coins. As later came out, he can be royally rewarded such Appraisals.

While the endorsements for various ICOs or cryptocurrencies have a very short half-life, this can not be said about a forecast: In July 2017, he stiffened to the statement that Bitcoin by the end of 2020 would have a value of 500,000 US dollars. Somewhat vulgar, he underlined this statement:

“If not, I want to eat my dick on national television.”

At the end of November he made his bet even more interesting: Since the price would have behaved significantly better than his underlying model, he would now assume one million US dollars . His realm was still at stake.

According to his own statements, John McAfee can predict the price of a doctor in point-set topology. While John McAfee does not look in the charts, McAfee’s claims can be described by exponential pricing, according to several sources.

Such models are not uncommon per se. Even classical investments such as the Dow Jones or the Dax can be described in principle by such a development:

The page fnordprefekt.de offers interested parties an entertaining tool with which you can model such price forecasts yourself. And indeed, as some sides promise, it can be — at least judiciously — a corresponding price trend to be accepted. Unfortunately, it can only be said with a sense of proportion, whether the model can really be justified on the basis of the data situation. In this article, therefore, an exponential price model is to be developed, which fits best to the actual price development.

# In a parabola for a million US dollars

For the modeling, a Fit based on the time between 17 July and 29 November 2017 is created first. As a function we assume the following:

Course = K0 * (1 + slope) ^ (t-t0)

The best fit function would be one where the distance between this model and the actual price is the lowest. Obtained logarithmically, the following relationship is then obtained:

The data of the fit model can now be used to determine a value for the 31.12.2020. And indeed! The most suitable fit, extrapolated by the end of 2020, will even reach $ 23 million. So far, one could say that the prognosis of John McAfee is very conservative.

The problem with such a consideration is that we focused on the development during a bull run. If the data are taken into account from July 2017 until today, “only” half a million can be reached.

This investigation could be carried out even more precisely: How does the prognosis for 31.12.2017 develop depending on the start time? For the next analysis, the fit is extrapolated until 31.12.2017, whereby the fit is based on data between a variable starting point and today’s date.

Of course, one can only look at the data in a limited way; From the beginning of 2018, the statistics are too low, and correspondingly, one receives highly fluctuating forecasts. But before that, the graph looks like this:

As you can see, the forecast “one million US dollars per Bitcoin” at least via a fit on the basis of an exponential price trend is currently not tenable. Taking only data into account since the beginning/middle of 2017, the forecast is tenable, but afterward, the forecast price drops dramatically. In that regard, it is feared that McAfee’s claim was primarily motivated by the bull market.

# Attention, McAfee: Low probability for a million!

Another approach was introduced a few months ago: Random Walks and the Monte Carlo method allow modeling Bitcoin price estimates. In the named article, the goal was to get a price statement for just over a year, however, the method can also be used for larger time forecasts. So let’s consider the distribution of simulated price developments until 31.12.2020. The histogram shows the likelihood of reaching certain prices above:

In fact, taking into account the last 2,000 courses, there is a certain likelihood of a course worth one million dollars by the end of 2020. How tall is this? Unfortunately, only 3 percent.

Whether John McAfee should worry about his crown jewels, time will tell. It is clear that his daring prognosis is not impossible, but quite unlikely.

*source and image: BTC-ECHO*