Bitcoin’s $1,000 trillion ‘base case’ rests on replacing real estate as a store of value

Bitcoin could displace real estate as a store of value and collateral, with a $1,000 trillion market capitalization described as a long-term base case by real estate entrepreneur and author Leon von Kamm.

The argument centers on Bitcoin absorbing the demand for wealth preservation that supports property values. Its accessibility and scarcity could allow it to compete with real estate both as a savings asset and as collateral within the financial system.

Speaking on the Bitcoin Magazine podcast on October 25, von Kamm, author of Digital Real Estate, described Bitcoin as better engineered money and a more accessible store of value. He argued that its market capitalization could eventually exceed that of real estate.

Von Kamm estimated the global property market at $300 trillion to $500 trillion, depending on the valuation model. He suggested that Bitcoin’s potential market could be twice that size, arguing that technological innovations can expand beyond the markets they replace. He called $1,000 trillion Bitcoin’s “base case,” without specifying when it might reach that scale.

His thesis rests on the view that property prices incorporate substantial demand for storing wealth. While land has long been associated with power and wealth, he said its monetary role developed more recently. He identified the end of dollar convertibility into gold in 1971 as a turning point and said real estate now holds roughly two-thirds of global wealth.

Borrowing is central to property investment returns, he said. Von Kamm put annual residential property appreciation since 1971 at about 6% and commercial property appreciation at about 4.5%, below his estimate of 7% monetary inflation. Financing up to 80% of a purchase with debt can increase returns through leverage, while rental income helps repay principal, making property lending attractive to banks.

He said higher interest rates had outpaced rental income in many markets, weakening the economics of property purchases. Deals become less attractive when annual income cannot cover the borrowing needed to finance them. Financial pressure can also force owners to sell below replacement cost, creating opportunities for buyers, he added.

For collateral, von Kamm emphasized whether an asset’s value grows faster than its debt, rather than whether it generates cash flow. He cited annual compound growth of about 50% for Bitcoin against about 5% to 6% for real estate. With supply limited to 21 million units, he argued that Bitcoin’s appreciation could reduce loan-to-value ratios quickly and support a more resilient financial system.