The way I see it, dollars and bitcoin are two competing forms of money. To calculate the equilibrium market cap of bitcoin, multiply each person's net worth by

The way I see it, dollars and bitcoin are two competing forms of money. To calculate the equilibrium market cap of bitcoin, multiply each person's net worth by the fraction they wish to allocate to bitcoin and sum over the population. For example if the total value of all goods is 200T and the net-worth weighted allocation fraction is 1%, then the equilibrium market cap would be 2T. You don't need "greater fools" because people are constantly buying and selling in equilibrium, not just selling, similar to how gold maintains a pretty steady 10T market cap. However bitcoin has superior intrinsic monetary properties to all other stores of value, including gold, so the equilibrium market cap might be extremely high.