You’ve been looking at the wrong Bitcoin chart

Every now and then, I am tempted to look at an all-time price chart of Bitcoin. Or I google the price of 1 Bitcoin in USD. What I find, is shocking…

linear price chart
Linear Bitcoin all-time USD price chart from bitinfocharts.com

That looks just unbelievable – it must be a bubble, a hype, and unsustainable, right? Wrong. I’ve just been looking at the wrong chart. What I found is a linear chart, and it is misleading. Have a look at this one instead:

lograithmic all-time price chart
Logarithmic Bitcoin all-time USD price chart from bitinfocharts.com

This is the very same data plotted on a logarithmic scale. In fact the growth of Bitcoin has been relatively smooth, steady and natural all along. Natural growth tends to be exponential. You find it in nuclear chain reactions, the growth of the human population, and economic growth, which is the one applying here.

And natural growth is usually limited. Looking at the logarithmic chart, you can see that the rate of growth actually seems to slow down over time – it grew at a higher rate in the beginning than it grew in the second half of 2017 (the year which ended with Bitcoin hitting $20k in December).

I have no clue what the limit might be, but I’m confident that Bitcoin will exceed the December 2017 spike again, unless something unexpected happens.