In May 2017 Apple Inc was in the press for being the first US company to achieve a Market Cap of $800Bn. This was just two years after it hitting a Market Cap of $700Bn.
At the time of the news it represented about 4% of the $21.7 Trillion that makes up the entire S&P 500 index. By any measure this is an amazing achievement and completely dwarfed the value of all Bitcoin in circulation.
On Monday 8th May 2017, Apple’s shares hit $153.44 giving it a Market Cap just topping $800Bn. In comparison, Bitcoin was trading at $1,655 giving it a Market Cap of $27Bn. Reaching for the calculator and putting the numbers in shows that Apple was valued at over 32 times the entire circulating supply of Bitcoin. So, this shows just how big Apple is and how small Bitcoin, despite all the press it has lately, is doesn’t it ? Well, if you just look at those numbers you are truly missing the bigger picture.
In fairness, we’re not comparing apples to apples (pun intended!). Apple Inc is a major tech innovator that has grown through creation, innovation and acquisition to become the giant it now is. Bitcoin in comparison has arisen from a paper published in 2008 by an anonymous author (or authors) and represents value only from the computational effort applied to mine strings of numbers. You can walk into a store selling Apple products, you can hold them, try them and buy them. Bitcoin doesn’t have any physical attributes and lives entirely in a virtual world — you can’t even hold a physical bitcoin.
What does make a comparison valid however is the growth rate in the respective valuations. To value Apple we can see how many shares there are and multiply this number by the share price to give us the Market Capitalization, or Market Cap as it’s generally known. With Bitcoin we can do something similar — we can see how many bitcoins have been mined, multiply this by the price and we get a Bitcoin Market Cap. But, I said earlier that Apple was $800Bn vs Bitcoin’s $27Bn earlier didn’t I ? Well……