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@ Christo
2025-04-22 20:11:38
BITCOIN IS GOING TO ZERO (annual return)
When Bitcoin kicked off in 2009, its supply surged with 50 BTC per block. Early adopters rode an exponential CAGR (Compound Annual Growth Rate), with dizzying returns reflecting the initial explosive issuance. But, as block rewards halved repeatedly—25, 12.5, 6.25, and now 3.125 BTC. The supply growth rate dwindled exponentially, inching ever closer to the asymptotic 21 million coin cap.
Here's the kicker: Even if markets hold demand relatively steady, Bitcoin’s price growth (and thus CAGR) logically mirrors this declining issuance rate. Early Bitcoin CAGR flirted with astronomical 4-digit figures, but just as its issuance follows a diminishing exponential pattern toward zero, its CAGR inevitably mirrors that trajectory.
Bitcoin’s future price appreciation under stable demand conditions naturally aligns closer to the inflationary tail-off of its issuance curve. Its CAGR thus becomes mathematically tethered to issuance decay, gravitating toward zero.
Welcome to Bitcoin’s dance toward stability.
The good news is that in 2050 with more than 99% of all Bitcoin already allocated, the annual return will still be above 5.7 percent according to this model.
Does this mean when all Bitcoin will be allocated around the year 2140 that there will be ZERO returns? I don’t know actually, but it is not far fetched to assume that diminishing returns will also tend toward zero if demand remains stable. This is exactly the point, given the network effect, Bitcoin will grow at an exponential pace and attract more demand in the long run so impossible to predict.
In the very end when all is traded for Bitcoin, everything will be measured in BTC or sats to be more likely. At this point of time the unit “Satoshi” will make sense and 1 sat = 1 USD. The CAGR will be ZERO, because no one will calculate a fiat-based CAGR any more.
https://cdn.nostrcheck.me/e00fe3235dca22236860f67304f7ad1787b92b0f999b1de935a443241a39f798/72bb9d31872570d10b07896b4c8abd1627153c7e38724998727edf0c47f3ec09.webp
https://cdn.nostrcheck.me/e00fe3235dca22236860f67304f7ad1787b92b0f999b1de935a443241a39f798/6aa4f32279e43157ae4166e679d15b5b2a37808d9a2f69578419e58e0f29a8bc.webp