Read: Why bitcoin may be worth only a third of its value

Some market participants, however, make the case that despite its roughly 260% year-to-date rise BTCUSD, +0.05%, it has to clear a far more stratospheric value hurdle to evolve into a practical form of money alongside fiat units like the U.S. dollar DXY, +0.01%, Europe’s euro EURUSD, +0.02%  or British pound GBPUSD, +0.02%.

Also read: Bitcoin faithful rage against Jamie Dimon

A single bitcoin was worth about $3,900 in recent trade on Monday, off lows of the past few days, according to data site Coindesk.com, amid regulatory headwinds in China and critical comments from Wall Street pros like J.P. Morgan Chase & Co.’s CEO Jamie Dimon.

Still, a bitcoin would need to be worth a stunning $1,000,000 to be a bona fide monetary unit, says Iqbal Gandham, U.K managing director at eToro, a trading platform.

Check out: Bitcoin at crossroads after shedding billion in value

In other words, the digital currency would need to see a 300 fold run-up from its current level. To be sure, Gandham isn’t making a prediction; though he believes the currency has the ability to scale such lofty levels, Gandham thinks that bitcoin needs to climb to such a level to be truly viable as a monetary unit.

To understand why is to understand the tiniest component of bitcoin—the Satoshi. Named after the purported creator of bitcoin, Satoshi Nakamoto. A Satoshi is equal to 0.00000001 bitcoin.

Put another way, one bitcoin contains 100 million Satoshis.

Satoshi’s value in dollars equated to $0.0000356819 at last check. Gandham argues that a Satoshi needs to be equivalent to a single penny, which it would when one bitcoin is worth $1,000,000.

“It is the Satoshi with which people will buy a cup of coffee,” Gandham told MarketWatch. He said using bitcoin now to purchase goods and services, as one would with dollars, isn’t feasible because bitcoin hasn’t reached the necessary economies of scale.

“People don’t use a bar of gold to buy things, they use subdivisions of gold,” he said, saying that using bitcoin now to purchase items is like using a bar of gold to purchase a beverage or a meal.

Gandham also said bitcoin really needs to get to that million-dollar mark in the next few years. Some are already wagering that it will get close: John McAfee, founder of his namesake antivirus software company says bitcoin is headed to the $500,000 level within three years.

“It needs to get there in the next few years if it is really going to work,” Gandham said. “People will only spend the subdivision of bitcoin—and you can only spend the subdivision—if they are of reasonable value,” he said.

Bitcoin has been in the buzzy consciousness of average folks for the better part of the past decade. Created at the height of the financial crisis, it has emerged for some as among the clearest alternatives to government-backed currencies.

Bitcoin bulls argue that much of the modern currency world is a product of a manufactured economy, in which central banks print money to boost economic growth, putting bitcoin and other digital currencies, like Ethereum, in position to be considered on par, if not better than, their fiat counterparts in terms of their economic utility.

Against the backdrop of easy-money policies, the Dow Jones Industrial Average DJIA, +0.07%, the S&P 500 index SPX, +0.18%  and the Nasdaq Composite Index COMP, +0.09%  are all at their highest levels in history, while the 10-year Treasury note TMUBMUSD10Y, 4.045%, with prices moving inversely to yields, seeing yields near historic lows.

Because bitcoin is decentralized from central banks or governments, individuals can conduct transactions without an intermediary. That is part of the appeal of bitcoin.

What’s more, digital currencies are underpinned by the so-called blockchain, a digital ledger that cannot be altered. For many, the blockchain—the promise of and applications that can run atop these computerized ledgers, such as innovative ways to execute and record stock trades, document loans or track property records—are the most crucial and lucrative aspects of the digital-currency realm.

So far, the ambitions of bitcoin cheerleaders haven’t translated in to a killer application, as Apple Inc.’s AAPL, -0.40% founder Steve Jobs would say. Meanwhile, growing scrutiny over bitcoin activity in China and comments from Dimon, who called the currency a “fraud,” has proved the biggest drag on so-called cybercurrencies.

Vitalik Buterin, the creator of the No. 2 digital currency, Ether on Ethereum’s blockchain, recently sounded warnings about the current hype and rapid rise of digital currencies on financial site Financial Magnates.

“I indeed think that we are in a bubble because all the cryptocurrencies are rising and people have a feeling that they will always continue to rise. A lot of projects are raising more money than what they would be able to in the normal VC market, and sometimes there is no match between the necessity and usefulness of the project and its ability to raise money. Additionally, this market is still young and people still don’t know how to differentiate between projects that will exist in the long term and those that won’t.

If bitcoin, and other digital currencies, can surmount its obstacles, it could take off, says Gandham.

That is because there are finite number of bitcoins that can be digitally mined, as is done by “miners” using powerful computers solving complex problems to create the crypto units and support the blockchain infrastructure.

Only about 21.5 million bitcoins will ever exist, based on its underlying code. It is estimated that about 16 million bitcoins have been mined so far, with only a portion of those in current circulation. Market participants also estimate that bitcoins will max out in 2141, about 124 years from now.

That is a relatively tiny number of bitcoins for a currency with ambitions of being a global currency. That is also why the value of Satoshis carry such significance. By comparison, there are approximately 1.56 trillion Federal Reserve notes in circulation as of July 12, according to the Federal Reserve. There are about $13.6 trillion dollars in circulation, according to the Fed, as of August 2017.

While bitcoin cannot be increased once developers and miners hit the limit, Gandham says, subdivisions can be increased to, say, a conversion rate of 500,000,000 Satoshis to every one bitcoin, for example, greatly expanding the supply of Satoshis.

That level of growth may help smooth out bitcoin trading, and perhaps make it less volatile on a day-to-day and intraday basis.

“If bitcoin is at a million dollars the day-to-day valuation change will be insignificant to the actual value,” Gandham said.