Would a successful bitcoin cause an unprecedented transfer of wealth?

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Short answer: not really.

Let’s assume that bitcoin becomes a very expensive commodity-money valued at $100,000 per bitcoin in 2014 dollars.

Bitcoin at $100,000 would leave about 100,000 people people with holdings worth $1 million or more. There are roughly 12 million millionaires in the world. Some of those folks (the 100,000 holders of 10+ BTC) would have already been millionaires before acquiring bitcoin. In the end, bitcoin millionaires would account for less than than 1% of millionaires maximum.

As for billionaires, there are currently about 1,645 billionaires in the world according to Forbes. With bitcoin at $100,000, it would add about 70 new billionaires, which is a 4% increase. Not insignificant. The most striking thing about this category would be the fact that Satoshi at this point would have 100 billion dollars. Perhaps he would be the richest man in the world (if he is an individual) and would almost certainly be in the Forbes Top 10.

So you can see that bitcoin in this scenario is not hugely disruptive, but it would certainly shake things up. The minority of bitcoin rich would be small but noticeable.

BTC would only be hugely disruptive if people began to losing faith in government currencies and rushed into BTC causing government currencies to hyperinflate. In that scenario, some current millionaires might find that they are no longer millionaires (in 2014 dollars) and even small bitcoin holders, such as those with 1-3 BTC would find themselves to be among the new millionaires. This scenario is not likely to occur and if it did occur, it would not happen quickly. And even if it did occur, most government fiat millionaires would still manage to own enough real estate and other hard assets to remain millionaires.

Thoughts?

EDIT: That being said, we should look to other big wealth transfers in history to see how bitcoin would compare. The largest sudden wealth transfers that I can think of would be the privatization of Soviet assets in Eastern Europe (and now in China) where young unknowns such as Roman Abramovich became billionaires. Bitcoin at $100,000 would be comparable at the billionaire level, but would fall short at the millionaire level, where China and Russia added millions of new class members very quickly.

submitted by slowmoon
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