Bitcoin has increased 37 times in four years since February 2017

Bitcoin is in a strong uptrend, bringing investors a higher return on investment than any other asset on the planet. In just four years from 2017 to today in 2021, the top cryptocurrency by market capitalization has a price-to-earnings ratio of 37 times. If it continues, the price of Bitcoin may rise even more in the future.

Bitcoin has risen 37 times since February 2017

Bitcoin is unlike any other asset. It bears the closest resemblance to physical gold, but exists only in cyberspace, is digitally encoded, and its supply is limited to 21 million.

Digital scarcity has prompted investors to view the asset as a hedge against inflation, just as gold has for centuries. But when it comes to Bitcoin, the young cryptocurrency has risen far better than the rest of the market, even precious metals, because it has beaten gold in almost every way imaginable.

In fact, in just four years, Bitcoin’s P/E ratio has reached 37 times, as shown in the following chart:

Twitter Charts

Four years ago today, the price of Bitcoin was around $1,000.

Bitcoin is still in an upward channel

At one point, Bitcoin was nearly worthless. Other four-year phases of Bitcoin price action also delivered 53x and 125x returns. The bull-bear conversion cycle attracted new participants each time.

Four years was chosen as the time sample because this is how often each block reward is halved. The halving event is built into the Bitcoin Core code and the mechanism reduces the number of Bitcoins miners receive for mining blocks every four years.

Bitcoin price history chart from TradingView.com

The halving mechanism is the magic that makes this internet currency much more interesting than gold. During a gold bull run, miners increase productivity and output to produce more ounces of the precious metal, flooding the market with more and more supply. Eventually supply is enough to meet demand, and momentum begins to wane.

With Bitcoin, when demand starts to rise, the supply is cut in half, causing the price to rise exponentially and go parabolic. This dramatic move attracts more and more investors, which is exactly what we are witnessing once again.

The current return rate is 37 times that in four years. What will happen in the next four years?