Bitcoin hasn't posted a figure exceeding five digits in its entire history, but John McAfee, the founder of McAfee Associates, still eyes $1 million for the world's first cryptocurrency by 2020 and has offered his reasons.

McAfee is known for pioneering the eponymous antivirus software, but in the past few years, he's been gaining popularity with his bullish comments about Bitcoin. In 2017, he made quite a buzz with his prediction of a $500,000 Bitcoin but upped the forecast to $1 million after seeing how the cryptocurrency skyrocketed that year.

Currently, he maintains his position and reaffirms in a tweet that the cryptocurrency will be at $1 million by the end of 2020.

McAfee's reasoning hinges on the old economic model for determining price -- supply and demand. McAfee told Forbes that the limited amount of Bitcoin (21 million) that will ever be in circulation would drive prices up once a more significant percentage of the world's financial transactions depend on the crypto.

"If Bitcoin gets to be 5% of world financial transactions, which, you all know it will ... maybe 10% or 20%," then Bitcoin would be worth "$10 million per coin, based on those numbers."

However, McAfee maintained that Bitcoin is only a store of value, but likens it to a brand like Colgate, which makes it different and poised to go up.

Several factors affect bitcoin's price, supply and demand is one of them. But to be integrated into the financial system at a rate similar to what McAfee upholds is where the question lies.

The rate at which Bitcoin processes transaction is relatively slow at 7 transactions per second (tps) compared to visa's 1,700. Ethereum can process more transactions than Bitcoin with a 15 tps.

Bitcoin is also affected by competing coins, and despite hundreds of ICOs (Initial Coin Offers) and IEOs (Initial Exchange Offers), it appears to still be at the helm.

Tuesday last week, Bitcoin dropped as much as 18%, but that didn't kill off John McAffee's optimism.

Bitcoin currently trades at $8,437.94.

Crypto currencies, despite regulatory grey areas, have been gradually making inroads into commerce in recent years with bitcoin leading the way Crypto currencies, despite regulatory grey areas, have been gradually making inroads into commerce in recent years with bitcoin leading the way Photo: AFP / Justin TALLIS