"New Choice for Forex Reserves?" VanEck predicts Bitcoin to surge to $2.9 million by 2050

Asset management giant VanEck recently released a research report indicating that if Bitcoin successfully transitions into a key role within the global financial system over the next 25 years, its price could reach $2.9 million by 2050. The core thinking behind this prediction is based on a critical question: if central banks around the world gradually allocate a portion of their foreign exchange reserves to Bitcoin, and Bitcoin becomes a settlement tool for cross-border trade, what would its value be?

The report, jointly authored by VanEck’s Digital Asset Research Head Matthew Sigel and senior analyst Patrick Bush, is not simply a price forecast but a valuation exercise using a “Base Case” scenario model. This model predicts that Bitcoin’s annualized return will remain around 15% in the future, implying a long-term valuation logic based on specific application scenarios, from the current price of $89,940 (as of January 2026) to $2.9 million in 2050.

A New Perspective on Central Bank Foreign Exchange Reserve Allocation

To understand why VanEck’s prediction focuses on foreign exchange reserves, it’s essential to grasp the concept of FX reserves. FX reserves are foreign currency assets held by central banks to maintain exchange rate stability, respond to balance of payments crises, and support the national currency’s credit. Traditionally, central banks hold reserves mainly in sovereign currencies like the US dollar and euro, but as the global financial landscape evolves, they are considering diversification strategies to reduce reliance on a single sovereign currency and spread risk.

VanEck’s report suggests that if some central banks, motivated by these considerations, gradually allocate a tiny proportion of their FX reserves to Bitcoin, it could become a significant driver of Bitcoin’s value appreciation. However, the report also admits that no country’s central bank has officially designated Bitcoin as a reserve asset yet, and such a shift would require more mature regulatory frameworks and international consensus.

Trade Settlement and Reserve Assets — Two Upgrades for Bitcoin

VanEck’s valuation model is built on two core assumptions. First, Bitcoin will gradually become a “global trade settlement asset,” potentially handling 5% to 10% of worldwide trade settlement volume in the future. Second, central banks may, for risk diversification reasons, allocate part of their FX reserves to Bitcoin.

However, VanEck clearly states that there is still a significant gap between these assumptions and reality. Currently, Bitcoin’s share in global trade settlement is negligible, and central banks’ FX reserve allocations remain predominantly in traditional sovereign currencies. Achieving this transformation depends on three key factors: clearer regulatory environments, improved payment infrastructure, and political acceptance of digital assets. These conditions are not yet fully mature.

Long-term Volatility Remains High, but Structural Position Continues to Rise

Despite the optimistic outlook, VanEck warns investors that the path to $2.9 million will not be smooth. The research forecasts that Bitcoin’s long-term annualized volatility will still be high, around 40% to 70%, resembling the characteristics of “frontier markets” (less developed emerging markets) rather than stable mature financial assets.

Notably, even under the most conservative “Bear Case” scenario, VanEck predicts Bitcoin will maintain positive growth. The report attributes this resilience to Bitcoin’s “structural importance” in the global financial system. From a macroeconomic perspective, Bitcoin’s price correlation with global liquidity changes is higher than that with stocks or commodities. This indicates that Bitcoin’s relationship with the broader money supply is emerging, while its linkage to the US dollar’s trend is gradually weakening.

Opportunities for Bitcoin in a Diversified Portfolio

From an asset allocation perspective, VanEck’s analysis shows that allocating 1% to 3% of a diversified investment portfolio to Bitcoin can significantly improve risk-adjusted returns. This does not mean Bitcoin is low risk — quite the opposite, given its high volatility — but because of the limited allocation, even sharp price swings in Bitcoin will not proportionally amplify the overall portfolio risk.

In summary, while VanEck’s report paints a grand long-term vision for Bitcoin, it also honestly points out the conditions and challenges needed to realize this vision. Whether central banks will be willing to include digital assets in their FX reserves, or whether global trade will adopt Bitcoin as a settlement tool, depends on future developments in regulation, technology, and politics. For investors, understanding these underlying assumptions is more important than blindly believing in a $2.9 million target.