Bitcoin’s Theoretical Price Ceiling Is Now $100k Per Coin – Bitcoin USD (Cryptocurrency:…

Introduction

The question of if a floor exists in the price of Bitcoin (BTC-USD)(COIN)(OTCQX:GBTC), and if so, what is that figure, has become a hot topic recently.

I would argue that the floor is determined by the probability of finding a gap between the fundamentals and the price. In other words, how many standard deviations below or above the price target are we at now? Any number is possible, but the extremely low and extremely high are both very rare, and therefore much less likely to occur. That’s the best we can do with the price floor. Watch the fundamentals and the rest is statistics.

However, the price ceiling is different. This is because we know there is a strong relationship between network activity and the price. To put it more succinctly, the more network activity we have, the higher the price. But, there are limits to network throughput, and this puts a lid on the price in the short to medium term.

We have seen this limit tested recently, when the Bitcoin blocks…