According to CoinDesk, by 2050, bitcoin may settle 10% of international trade and 5% of local trade, with central banks holding it as a reserve asset, asset manager VanEck stated in a report. The report highlights that Bitcoin layer-2 networks will be crucial in overcoming scaling issues, enabling BTC to be used as a medium of exchange.

VanEck, an issuer of spot bitcoin and ether ETFs, projects that BTC's price could reach $2.9 million by 2050, assuming significant hurdles are cleared. The report suggests that bitcoin will become an essential part of the international monetary system in the coming decades due to rising geopolitical tensions and increasing debt servicing costs, which are eroding the current system.

Matthew Sigel, head of digital asset research at VanEck, noted in a CNBC interview that current economic imbalances, distrust in existing institutions, and deglobalization are driving the need for alternatives like bitcoin. Sigel explained that the misallocation of capital since the global financial crisis, driven by G7 governments' excessive money printing, has led to fiscal recklessness, against which bitcoin serves as a hedge.

In the report's base case scenario, BTC would become a key medium of exchange in both local and global trade, representing 10% of international trade settlement and 5% of GDP. Additionally, it would gain as a global reserve asset, reaching a 2.5% weight in international currency reserves, at the expense of the U.S. dollar, euro, British pound, and Japanese yen.

If VanEck's vision materializes, bitcoin's price could increase 44 times, achieving an annual growth rate of 16% from its current price of just below $65,000, with its market capitalization soaring to $61 trillion. The proliferation of layer-2 networks will be key in addressing the Bitcoin blockchain's bottlenecks and scaling issues, potentially making the sector worth $7.6 trillion by 2050, using a similar valuation framework as for Ethereum layer 2s.

However, VanEck also warned of potential risks that could hinder bitcoin's growth. Increasing energy demand by miners will necessitate innovation, and transaction processing revenue must grow significantly to replace diminishing mining rewards, which halve every four years. Additionally, concerted government efforts to restrict or outlaw bitcoin, competition from other cryptocurrencies, and large financial institutions exerting excessive control pose significant threats to bitcoin's expansion.