In a 2014 interview, billionaire investor Tim Draper predicted the bitcoin price to surpass $10,000 in three years.
In an interview with Fox Businesses in 2014, billionaire investor Tim Draper predicted the bitcoin price to surpass $10,000 in three years. At the time of reporting, the bitcoin price is at $9,650, and is en route of reaching $10,000 by the end of 2017.
Basis of Draper’s Prediction
Since 2014, Draper has been one of the most active investors in the cryptocurrency market, alongside Barry Silbert of Digital Currency Group. Within the past three years, Draper has funded both regional and international bitcoin businesses, including the $1.6 billion bitcoin brokerage and wallet platform Coinbase, $160 million South Korean cryptocurrency exchange Korbit, and bitcoin service provider Coinplug.
Three years ago, after participating in various auctions to purchase batches of tens of thousands of bitcoin, Draper focused on building the necessary infrastructure for the bitcoin market to prosper and grow at an exponential rate. His investment in companies like Coinbase and Korbit played a vital factor in the rapid growth of the US and South Korean bitcoin markets, the second and third largest bitcoin markets behind Japan.
Apart from a $120 million profit he secured from his bulk purchase of 30,000 bitcoins in 2014, Draper has been one of the most successful early-stage investors in the bitcoin and cryptocurrency sector over the past three years, finding massive success in both direct investment in bitcoin and venture capital funding of bitcoin startups.
In the early days of bitcoin and the cryptocurrency market, even up until 2014, there was uncertainty in the future of the cryptocurrency sector, given bitcoin’s performance from 2013 to 2014. However, many early investors in bitcoin such as Draper had strong belief in bitcoin as the next global store of value and digital currency.
“[I’m] very excited about bitcoin and what it can do for the world. Bitcoin is as big a transformation to the finance and commerce industry as the internet was for information and communications. If bitcoin were here in 2008, it would be a stability source for our world economy. Everybody should go out there and buy a bitcoin. Every investor who’s a fiduciary should at least be partially involved in bitcoin because it’s a hedge against all the other currencies. There’s a whole ecosystem being built that’s going to make commerce much easier with much less friction and safer,” Draper said in 2014.
Hence, for Draper, a $10,000 mid-term target of bitcoin was not an ambitious target to begin with. Draper has been expecting the price of bitcoin to surge to a few hundred thousand dollars, especially with the entrance of major financial institutions and tens of billions of dollars of institutional money into the bitcoin market.
Bitcoin in 2018
Throughout 2017, the market valuation of bitcoin increased from $10 billion to $160 billion solely through the adoption of general consumers and casual investors. Billions of dollars in institutional money from hedge funds like Man Group and Fidelity will trigger another surge in the price of bitcoin in the short-term.
Featured image from Flickr/Web Summit.