After its launch in 2009, Bitcoin ushered in a new generation of blockchain technology and digital currencies. Given all the talk about Bitcoin, you’d assume it would be everywhere. Is that actually true? How much is Bitcoin worth? Perhaps more importantly, how much of the world’s cash is in bitcoins? With the price of bitcoin at 34,843 U.S. dollars as of May 30, 2021, it is without a doubt worth our time to figure it out.
All the bitcoins in the world were worth roughly $653 billion.
The combined price of bitcoin was equivalent to just 1.7% of the world’s money.
Bitcoin was really worth only about 5.3% of the world’s gold supply.
All of cryptocurrencies accounted for is less than 5% of the world’s money.
Worth of Bitcoin?
According to the CoinMarketCap, the value of all the bitcoins in the world amounted to $653 billion as at May 30, 2021. For comparison sake, Forbes estimated the net worth of Amazon (AMZN) founder Jeff Bezos at $177 billion.We calculated the total value of Bitcoin first because that is the easy part.
That makes the market cap of Bitcoin almost 4 times greater than Bezos’ fortune.
Important El Salvador made Bitcoin legal tender on June 9, 20212. It is the first country to do so. The cryptocurrency can be used for any transaction where the enterprise can accept it. The U.S. dollar continues to be El Salvador’s primary currency.
Bitcoin and the Money Supply
To get to know how much of the world’s money is in bitcoins, we have to know the total amount of money. This is not the easiest question to answer. Such a calculation might take into account dozens of categories of monies, including banknotes, precious metals, money market accounts, and also debt. The Money Project tried this computation in May of 2020 and estimated around $35.2 trillion in global narrow money.
This now leaves Bitcoin at about 1.8% of the estimated value of narrow money from The Money Project’s report.
Note that the market capitalization is considered a controversial metric, especially when applied to cryptocurrencies. Though this is a convenient way to assess the total value of an asset, it is highly subject to manipulation.
Bitcoin vs. Gold
what is Bitcoin comparism to Gold? Up till today, people still consider gold to be real money. It is the gold standard to which other currencies must be compared. We shall begin with the World Gold Council’s figures. They estimated that about 197,576 tonnes of gold had been mined throughout history as of the end of 2019. An average of about 2,500 tonnes are mined each year, so we can safely estimate around 200,000 tonnes of gold in existence as at the end of 2020. There are 32,150 troy ounces of gold in one tonne, and the price of gold per ounce was $1,913.5 So, we can estimate the overall value of all gold as:
200,000 tonnes of gold x 32,150.7 troy ounces per tonne x $1,913 per ounce = $12.3 trillion.
In total, the value of all bitcoin rounds up to 5.3% of the value of all gold.
Bitcoin is the greatest and best-known cryptocurrency in the international economy. However, it is some distance from the only one. If we should join Bitcoin with Litecoin, Monero, Ethereum, and all the different substantial cryptocurrencies, the whole value comes to roughly $1.5 trillion.
That is nevertheless a bit less than 4.3% of the cost of all narrow cash given above.
Bitcoin and other different cryptocurrencies are relatively volatile and illiquid, and they are susceptible to slippage and price manipulation. Before investing, make sure you apprehend the dangers related with virtual assets.
After its launch in 2009, Bitcoin ushered in a new generation of blockchain technology and digital currencies. Given all the talk about Bitcoin, you would suppose it would be everywhere. Is that virtually true? How much is Bitcoin worth? Perhaps more importantly, how much of the world’s cash is in bitcoins? With the price of bitcoin at 34,843 U.S. dollars as of May 30, 2021, it is in reality well worth our time to figure it out.