Bitcoin (BTC) is really close to a massive adoption by the wider society.
Is there a chance to see price of BTC at around 60 000 USD? We can see a correlation between the price of BTC and Apple Inc.’s stock prices back in 2008. Could this be a sign that the price of BTC will rise?
BTC vs Apple
We can see some resemblance. Overall 11% of Americans own BTC. It was just like that with smartphones in 2008. A similar correlation can be seen between BTC and S&P 500. Bitcoin clearly has its benefits, yet it still has a long way to go before a wide-scale adoption. Our society has deep roots in fiat money. We still believe they are safe. Many people don’t think like that about BTC.
Let’s take a look at a book called Diffusion of Innovations (1962), by sociologist Everett Rogers. Thanks to this book we know about 5 groups of people: innovators, early adopters, early majority, late majority and laggards.
Thanks to this book we better understand preferences of each group, their habits and psychological profiles. However, the most important part on this graph is the space called “the chasm”.
We can’t ignore this gap. It can either signify a successful leap into the mainstream market, or the failure of a product/service. We see this similarity with the cryptocurrencies of today. It’s really important to cross over this chasm for any product or service.
The sales of smartphones
We can see that crossing of the gap in relation to the growing sales of smartphones.
Although we all know them today, we can see it wasn’t much of a boom initially. That’s because the smartphones made it over the chasm.
Actually we can see this with the Apple iPhone. In 2007 the company sold 300 000 smartphones during the first week. One year later, with the iPhone 3G, they sold 1 million units. There was a fall in stock prices back in 2008, when prices fell after a 63% rally. Prices fell down about 22%. These were hard times. People were in the early adopters phase in 2008. In 2010, there was a boom, it was when Apple introduced Apple iPhone 4.
Those who sold Apple shares due to that 22% price drop are probably very angry with themselves now, seeing as the price shot up about 520%. It is similar with Bitcoin and other digital currencies. For now it’s hard to speculate what has to happen for the digital currencies to start a massive adoption. However once it does happen, the price will sky-rocket and then it will be too late to try to enter the band wagon.