Bitcoin's Path to $1 Million: A New Valuation Logic Driven by Expanding Store of Value Market

How should Bitcoin's value be measured? Traditional static models are struggling to accurately reflect its increasing store-of-value properties. Analysts suggest that instead of using outdated methods, Bitcoin should be compared to gold. As global recognition of digital assets' store-of-value function deepens, its scarcity and market positioning are becoming central to its pricing.

Currently, the total global store-of-value asset market is approximately $38 trillion, with gold dominating. Bitcoin's current market capitalization is about $1.4 trillion, only accounting for 4% of this market. To achieve a target of $1 million per Bitcoin, its market share needs to increase significantly. However, it is important to note that this market is not static. Historical data shows that the gold store-of-value market has grown from $2.5 trillion in 2004 to nearly $40 trillion today, reflecting the profound impact of economic uncertainty and policy changes on asset allocation.

Based on this extrapolation, the global store-of-value asset market may expand to $121 trillion in the next decade. In this scenario, Bitcoin only needs to capture 17% of the market to achieve a $1 million price target. This prediction is not just speculation; it is supported by a clear trend: institutional investors' allocation to Bitcoin has steadily increased from 1% to nearly 5%, and the approval of spot Bitcoin ETFs in the United States has significantly lowered the barrier to entry for institutions, driving continued capital inflows. Of course, this optimistic expectation is highly dependent on two major premises: whether the store-of-value market can expand as expected, and whether Bitcoin can continue to gain more market share. If either of these factors is hindered, the target may be delayed. As of now, Bitcoin's price is around $70,000, still significantly far from $1 million, but its valuation logic is undergoing a fundamental restructuring, and the shift in market perception may become a key driver.