The Internet was a major technical innovation in the 1990s that caught the attention of the majority of Generation X (born between 1965 and 1980).
Now, the era of bitcoin and digital assets is slowly unfolding in space, and both the Millennials and Gen X are getting used to seeing the technology-based financial systems as they become uncertain about the existing central banks.
Cerulli Associates, A world-wide asset management organization recently stated that over the next couple of decades, an estimated 68 trillion USD is going to shift hands, and it will be acquired by Generation X and the Millennials. Amidst, one of the greatest wealth transfer, it is only a matter of how much capital will come into Bitcoin.
According to a recent report released by Kraken, it was indicated that Generation X and the Millennials were the most apt-group of people to embrace the development and adoption of Bitcoin amidst issues like negative interest rate policies and the declining value of USD.
The report stated that the flow of capital into Bitcoin would depend on three key things,
- The rate for the adoption of innovative technology.
- The rate of inheritance of wealth.
- Expected average wealth allocation to Bitcoin.
Over the years, the rate of adoption for various innovative technologies have become faster, as market saturation for internet, cellphone and smartphone usage took less than 24 years. Bitcoin was heading towards a similar direction and combining the fact that the internet was a household essential and BTC’s accelerating growth, Bitcoin’s market saturation could take place faster than expected.
Quantifying the Numbers
Bitcoin currently manifested the nature of an S-curve which basically meant that its growth sustained with respect to time as very high.
The report assumed a time frame of 25 years for Bitcoin to approach critical mass between the Millennial and Gen X. On a minimum allocation of 5 percent of their assets/inherited in Bitcoin, it was believed that by 2044 the annual capital inflows will be around 1 trillion USD. The report stated,
“Assuming a 5% peak allocation by 2044 and a 2% inheritance tax rate, we expect just under 1 trillion USD of wealth to flow into Bitcoin over the next several decades.”
However, it can also be analyzed from the above table, considering only 1% of the total inherited wealth flows into Bitcoin, and 5 percent in USD tax is levied, a whopping $188 billion will still be absorbed by BTC, doubling its current market cap.
Lastly, the report suggested that the figure could higher than $1 trillion since the data above only considers the US market’s wealth into the statistics. On a global scale, the wealth transfer could be much higher, as Bitcoin continues to take a step towards wider adoption in the financial industry.
At press time, Bitcoin was valued at $6300 after hiking close 350 USD in the past 12-hours.