CRYPTOCURRENCY – A DISRUPTIVE THOUGHT

Bitcoin's price has exhibited phenomenal growth but is invariably marked by significant volatility. This underscores the need for measures to broaden its base to stabilize its price fluctuations.

Traditionally, stock prices reflect an underlying business's performance. Bitcoin's core functionality revolves around transferring and storing money value, yet these fundamental capabilities fail to fully explain its extraordinary valuation.

Bitcoin’s unprecedented valuation reflects more than traditional market dynamics. Its price movements are influenced by a complex interplay of technological innovation, investor sentiment, regulatory landscapes, and global economic uncertainties. Unlike conventional stocks anchored to corporate performance, Bitcoin's value derives from its decentralized nature, limited supply, and growing institutional acceptance.

Bitcoin’s astronomical price is largely driven by its brand—a value built predominantly on trust. But how substantial is this trust factor? A comparative analysis with other cryptocurrencies reveals intriguing insights.

Consider that Bitcoin's nearest competitor has a market value approximately 30 times lower. If we conservatively estimate the cryptocurrency's intrinsic value at USD 5,000, then a staggering USD 100,000 of its price stems from brand perception. This brand-driven valuation is inherently fragile, susceptible to rapid erosion when investor sentiment shifts, even without direct technical performance concerns.

This explains Bitcoin's notorious price volatility. Market movements are frequently triggered by external factors unrelated to the Bitcoin's core technological capabilities—a characteristic that typically signals speculative investment rather than stable value storage.

STRATEGIES FOR SUSTAINABLE GROWTH

With a current market capitalization approaching USD 2 trillion and a deliberately limited supply of 21 million mineable coins, Bitcoin faces a critical strategic decision.

By expanding its total coin supply—potentially tripling the current limit—Bitcoin could democratize ownership, allowing broader participation. While this would inevitably impact individual coin prices, it could potentially:

- Increase total market value

- Reduce price volatility

- Enhance market accessibility

Such a strategy would transform Bitcoin from a scarce, speculative asset to a more widely distributed, potentially more stable financial instrument and help to maintain its market dominance.