Even if you factor in the recent wobble, Bitcoin (BTC 0.98%) has been on a tear recently. It’s gained almost 55% in the past six months, setting new all-time highs as quickly as Michael Phelps in an Olympic swimming pool. Over the past decade, it has outperformed many other asset classes.

For some crypto bulls, the question is not whether Bitcoin will succeed but how high the top coin might go. ARK Invest’s bull case sees Bitcoin at almost $1.5 million by 2030. MicroStrategy (MSTR 0.65%) chair Michael Saylor goes even further: He thinks BTC’s price will reach $13 million by 2045.

If you’re worried that you’re late to the Bitcoin party, those targets from big names are reassuring. However, they are also extremely ambitious — and I speak as someone who’s optimistic about Bitcoin. Let’s take a look at why it could happen. Then, I’ll explain why it’s unlikely.

The case for Bitcoin to reach $1 million

At its simplest level, for Bitcoin to continue to soar for the coming decade, people must use it. ARK Invest identifies several potential growth areas, including more countries adopting it as legal tender. El Salvador and the Central African Republic have already done so.

Bitcoin could also take a serious chunk out of the global remittance industry, making it cheaper and easier to move money internationally. Straits Research valued the global digital remittance market at almost $23 billion in 2023, and ARK’s most optimistic predictions say Bitcoin could take 25% of that market.

Bitcoin’s potential as a form of digital gold is another reason for optimism, particularly combined with increased institutional adoption. Like gold, Bitcoin isn’t controlled by any government. And only a fixed number of Bitcoins will ever be produced. That could make it a good hedge against inflation, though it still must prove itself here.

Right now, optimism about the impact of a more positive regulatory environment has played a major part in the recent rally. But it is too early to say how this will play out in the longer term. Regulation can be a fickle beast.

Here’s why Bitcoin’s unlikely to reach $1 million before 2035

Bitcoin’s been hovering around the $100,000 mark for the past couple of months. As such, it would have to grow tenfold in the next decade to reach $1 million. That’s a lot. Especially for a relatively new asset that’s already proven pretty volatile and has a questionable environmental record.

The approval of Bitcoin exchange-traded funds (ETFs) has made it easier than ever for investors to add the grandaddy of cryptos to their portfolios. That influx of retail and institutional money has somewhat lessened Bitcoin’s volatility and improved its reputation. All the same, people who own Bitcoin through an ETF aren’t actually using it to make transactions.

If they did, they’d know this emerging technology still struggles with transaction costs and processing times. Imagine doing your Christmas shopping and waiting 10 minutes to 60 minutes or more for the payment to process. Or having to pay $1 or $2 for every transaction. The Lightning Network is a big step in the right direction, but there’s still a long way to go.

Another issue is the degree to which Bitcoin and cryptocurrency are used by criminals. According to The Motley Fool’s research into crypto and investment scams, crypto is the top payment method for investment scams. That’s before we even say the word “ransomware.”

If $1 million is unlikely, should you still buy Bitcoin?

If you’re trying to work out whether cryptocurrency is a good investment, don’t pay too much attention to pundits and their sky-high predictions. Instead, do your own research into the technology, regulatory environment, and its utility.

The challenge is that there is a huge amount we don’t know. This includes regulatory changes, unforeseen security failures, and global economic changes. We also cannot discount the possibility of another FTX-esque exchange failure.

Bitcoin can have a place in a balanced portfolio, particularly if you hold it long term to ride out short-term price fluctuations. You can also mitigate the risks by investing only money you can afford to lose and ensuring it makes up a small percentage of your portfolio.

With a strong wind behind it, Bitcoin’s price could reach $1 million eventually. Just don’t count on it.