Learn how Bitcoin can improve your real estate portfolio performance.

Purpose of the portfolio estimator

Explore the future value of your real estate and Bitcoin portfolio by applying historical growth trends, volatility patterns, and market dynamics. For real estate, the model uses the Compound Annual Growth Rate (CAGR) to estimate long-term appreciation, while for Bitcoin, it relies on generative price trajectories modeling historical price trends. The tool helps you visualize potential portfolio outcomes, assess risk exposure, and make more informed investment decisions.

Power-law model overview

The tool relies on the Bitcoin power-law model, introduced by physicist Giovanni Santostasi in 2018. He observed that Bitcoin's long-term price history follows a power-law curve—a smooth arc when plotted on a logarithmic scale—rather than chaotic or speculative randomness. This model suggests that Bitcoin's growth over time is shaped by adoption and market cycles, not guesswork. While short-term fluctuations are significant, Bitcoin has historically remained within boundaries that align with this long-term trend.

Modeling Future Volatility

While the power-law model offers a long-term price expectation, actual market behavior includes frequent, unpredictable swings caused by news, regulations, sentiment shifts, and macroeconomic conditions. To account for this, the tool generates multiple future price trajectories, introducing volatility patterns that mirror Bitcoin's historical behavior. These help users assess potential outcomes and understand the risks of timing—commonly referred to as sequence-of-return risk.

Advanced Modeling Features

Bitcoin Price Model Selection
You can choose from three Bitcoin price tracks based on variations of the power-law:

• Low: Follows historical bottoms.
• Medium: Tracks the long-term average model trend.
• High: Reflects historical tops.

When the Estimate min/max setting is enabled, the model adds the above mentioned statistical volatility patterns to allow estimating an expected portfolio value range at a given time. Note: when enabled in conjunction with the Low Price Model, the price may dip below historical bottoms and the High Price Model may now exceed historical tops. This can be used to generate out-of-band bullish or bearish scenarios.

Inflation Adjustment

You can enter a custom inflation rate(%) to add a valuation of the future portfolio value in "inflated" dollars, i.e., adjusted for purchasing power.

• The default rate is 6.2%, the average M2 monetary supply growth between 1980 and 2025 (FRED M2).
• Alternatively, users may apply the CPI, the Fed's 2% target, or personal inflation estimates reflecting their cost of living.

Real Estate Growth Estimate

The real estate portion of your portfolio is modeled using the 5.6% CAGR for U.S. residential real estate from 1971 (post-gold standard) through Q4 2024. This period captures cycles of appreciation and correction, offering a stable long-term growth estimate.

Data source: FRED ASPUS