Speaking at a recent symposium, VanEck’s head of digital assets research, Matthew Sigel, said that, given the current shift away from the US dollar, bitcoin’s relevance and price are likely to experience a sizable boom.
By 2028–29, VanEck predicts bitcoin could climb to US$449,000, while the current cycle is expected to peak at US$180,000. The exchange-traded fund (ETF) provider’s model anticipates bitcoin could reach US$3 million by 2050, assuming central banks adopt the cryptocurrency at a 2 per cent allocation and 5 to 10 per cent of global trade – initially led by BRICS nations – is settled in bitcoin.
“We see bitcoin emerging as a significant portion of central bank reserves and being used as a large settlement currency in global trade,” Sigel said.
He pointed to a trend of “two-pronged de-dollarisation” that is enhancing bitcoin’s appeal – the first being the fall of the US dollar’s share of foreign exchange reserves and the second, the politicisation of the financial rails which underpin it. In other words, both the fiat currency itself and the systems that carry it have become politicised, he explained.
“No reserve currency lasts forever. We have pretty high conviction that bitcoin is going to make it another 100 years,” he said.
Reserve currency appeal
According to Sigel, various countries are already looking to "disintermediate the dollar as a store of value”, which in turn would need to be replaced by alternatives – be it the Chinese RMB, the Russian ruble, or “neutral alternatives like bitcoin”.
Currently, there are already 10 national governments mining bitcoin or holding it in reserve, including major players like China and the US, but also smaller nations like Venezuela and El Salvador.
As Sigel explained, bitcoin is a currency increasingly tailored towards emerging markets and younger demographics, with a recent survey by business technology platform Square finding the countries most sceptical of bitcoin – such as France, Germany, Canada and Japan – are characterised by older populations and significant debt.
“The most optimistic: Nigeria, India, Vietnam, Argentina, these are generally emerging markets with young demographics,” Sigel said.
Moreover, he outlined how some of the most recent entrants to initiate government-backed bitcoin mining operations – Ethiopia, Argentina and Kenya – all have debt deals with the International Monetary Fund (IMF).
“Bitcoin has emerged as a compromise currency whereby these countries can regain negotiating leverage with the IMF, restore sovereignty over the printing press and monetise some of their stranded energy,” Sigel said, adding that he expects this trend to continue.
Essentially, owing to its appeal as a reserve currency in burgeoning markets, he explained that bitcoin’s long-term outlook looks promising.
Emergence as a settlement currency
On the other hand, he noted that since September 11, 2001, payment systems like SWIFT have become highly politicised, with some viewing Visa and Mastercard as having an excessive grip on the retail flows of funds.
Building on this point, Pranav Kanade, portfolio manager of digital assets at VanEck and fellow panelist, said stablecoins are stepping in to fill this gap.
First led by the BRICS nations, Kanade noted that stablecoins are currently experiencing significantly higher transfer volumes in Latin America and sub-Saharan Africa, which suggests a large amount of commercial activity.
While not yet prominent in the US, given the recent GENIUS Act and ongoing regulatory discussions under President Donald Trump, he said VanEck expects to see “a lot more payment activity and commerce happen on stablecoin rails” across North America and Europe as well.
Kanade views the rationale behind the use of stablecoins as “pretty straightforward”, arguing that currently, a single credit card payment involves two banks, the Mastercard/Visa network and a payment gateway. In contrast, stablecoin use removes banking intermediaries.
“We think three verticals will ultimately take the stablecoin market from US$250/$260 billion to a few trillion: B2B payments, B2C e-commerce, and remittance,” he said.
Also speaking on the panel, deputy head of investments and capital markets at VanEck, Jamie Hannah, added that the same principle applies to bitcoin, given its role as the leading cryptocurrency asset.
“I would say in Australia, potentially in the US, people aren’t going and buying their coffee for bitcoin at the moment, but it is a substitute for a currency that is used more in emerging markets”, Hannah said.
At the same time, there is a growing conversation regarding bitcoin’s commercial applications in Western countries. Just this week, Square’s owner, Jack Dorsey, has encouraged sellers to adopt bitcoin payments, with plans to introduce an orange checkout button next year which will expand the POS system’s existing cryptocurrency services.
However, Hannah still has reservations: “Its chance of [becoming] a fiat currency going forward is an option, but it might not play out over time.” He instead lauded bitcoin’s attributes as a long-term investment, particularly its benefits in portfolio diversification and liquidity.
An early adopter of the currency, VanEck currently has US$5 billion in cryptocurrency strategies, more than half of which is simple buy-and-hold bitcoin and Ethereum ETFs. The firm also owns 10 per cent of shares outstanding in its own bitcoin ETF.
