Bitcoin is still far from the status of macro assets but is catching up relentlessly, says Coin Metrics’s "State of the Network."
“All facets” of Bitcoin (BTC) trading volume are growing exponentially and can easily match major asset classes, says a new report.
Released on Tuesday, Coin Metrics’s "State of the Network" casts the spotlight on Bitcoin trading, producing some surprising figures as BTC/USD passes $10,000.
BTC volume growth “exponential” across the board
Measuring volume is difficult with the largest cryptocurrency, Coin Metrics says, given the many types of exchange and associated platforms in the space.
“The fragmentation of trading volume in the Bitcoin ecosystem prevents a straightforward assessment of its market size,” the report concludes.
“Institutions considering entering the space should first survey the landscape and make a determination of which exchanges, markets, and assets they feel comfortable transacting in.”
Nonetheless, the future of Bitcoin as an asset class is extremely promising.
Coin Metrics summarizes that “all facets of Bitcoin’s trading volume have experienced exponential growth and, if sustained, will grow to levels similar to major asset classes.”
Cryptocurrency and fiat trading volumes. Source: Coin Metrics
$5 million per day in Bitcoin?
Individual figures include $500 million volume per day from major exchanges alone. This, the report suggests, provides the best answer for an institutional buyer considering how much capital to allocate to Bitcoin.
“For a buy-side institution interested in deploying fresh capital into the space, the trading volume of Bitcoin spot markets quoted in U.S. dollars of $0.5 billion per day from major exchanges is perhaps the most relevant,” it states.
“With this level of trading volume, a buy-side institution wishing to not exceed one percent of total trading volume could expect to deploy $5 million in capital per day.”
Existing institutional services such as Bitcoin futures and options continue to see new records in terms of both volume and open interest.
Futures “leading” other price indicators is further a key sign to watch for in the short term, Cointelegraph Markets analyst filbfilb told traders on Tuesday.