Is Bitcoin becoming the 'Google' of cryptocurrency as the BTC market cap approaches a new high?

Bitcoin is approaching Google's market capitalisation, but why is this a significant trend to watch?

According to Holger Zschaepitz, a market analyst at Welt, Bitcoin (BTC) is approaching Google's valuation as it approaches $1.5 trillion in market capitalisation.

As of April 17, the market capitalisation of Bitcoin is around $1.12 trillion, while the overall valuation of the crypto market is comfortably above $2 trillion.

What are the parallels between Bitcoin and Google?

The similarity between Bitcoin and Google that Zschaepitz drew attention to is that both have market dominance in their respective industries.

Bitcoin has the strongest network effect in the cryptocurrency market, accounting for more than 51% of the total market.

Google dominates the search engine market and controls a sizable portion of the video-sharing and streaming sector through its ownership of YouTube.

Zschaepitz stated:

"The Exponential Age: Due to network effects, the value of #Bitcoin is increasing and has nearly reached the stock market value of a classic network share #Google, which is worth $1.5 trillion."

Due to the rising valuation of Ethereum and layer-one blockchain networks, it is unclear whether Bitcoin's dominance over the cryptocurrency market will be sustained in the long term.

The main difference between Bitcoin and the rest of the market, however, is that there is clear institutional demand for BTC as a store of value due to its unrivalled blockchain network computing power, and thus security and trustlessness.

As a result, investors generally regard Bitcoin as a hedge against inflation as well as the de facto reserve cryptocurrency.

JPMorgan strategists predicted in January that Bitcoin could reach $146,000 as it competes with gold as a store of value.

According to the strategists:

“This long-term upside based on an equalisation of bitcoin's market cap to that of gold for investment purposes is conditional on bitcoin's volatility converging to that of gold over time. The reason for this is that, for most institutional investors, the volatility of each asset class is important in terms of portfolio risk management, and the higher the volatility of an asset class, the more risk capital it consumes.”

Traditional financial institutions are also recognising the significance of Bitcoin's network effect and dominance in the cryptocurrency market as the go-to store of value.

Where will the price of Bitcoin go from here?

After Coinbase's public listing, the sentiment towards Bitcoin will likely remain mixed for the foreseeable future.

Following the listing of COIN, there is speculation that the crypto market has reached its peak.

Most on-chain data and market indicators, such as funding rates, do not, however, indicate that a blow-off top is imminent.

For example, popular cryptocurrency trader "Crypto Capo" stated:

"Many people have stated that funding is plentiful, not only in Bitcoin but also in altcoins. This is a relative statement. When we compare current funding levels to those at the end of 2017, we see that they are low, especially considering the price is three times higher. Furthermore, the current trend is being driven by spot trading rather than derivatives."

Meanwhile, key on-chain metrics indicate that Bitcoin's price is still far from the bull market's peak. On the contrary, according to Bloomberg analysts, the price of Bitcoin may easily reach six figures, as predicted by the popular stock-to-flow model, and may even reach $400,000 in the future.