Data Shows Bitcoin is Used as Asset, Not Currency

When Satoshi invented bitcoin it seemed to be his intention to create a digital currency to be utilized for transactions that do not require a trusted 3rd party. He didn’t mention in his whitepaper the possibility of the asset becoming a store of value.

Over time as Bitcoin was used mainly for illicit activity and due to the fact that transaction speed is slow and challenging to enact, it has evolved to become more of a speculative asset. Combined with the advent of exchanges its value has continued to soar.

Bloomberg recently published a piece looking at the actual numbers behind this practice. They considered Bitcoin’s speculative nature negatively, calling it a “problem.”

Work from a New York based blockhain research firm called Chainalysis indicated that only 1.3 % of Bitcoin transactions were use for purchases in 2019, a number that is stable from year to year.

Several commentators are quoted as generally believing Bitcoin will never become a primarily used as a currency, but all seem to be bullish on its future valuation.

In fact if it were used as a currency its price would have to be stable. If used as a speculative asset, the goal is the moon.

Source (Bloomberg)

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