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Bitcoin isn't going away

If you follow cryptocurrencies, you’re likely aware that there’s been some pricing pressures recently. 

For instance, here’s a look at the price of Bitcoin from its inception in 2009 to today.  Over the course of the past almost decade Bitcoin has gone from $0 to $3,625.

The rise to $3,625 hasn’t been smooth, of course.  For the first 8 years of Bitcoin’s existence, the cryptocurrency floated under $1,000. 

Then in March 2017, Bitcoin took the world by storm. The mania for Bitcoin exploded, as did the price.  Bitcoin went from a trading price of around $1,000 per coin to a peak of $19,290 on December 17, 2017. 

After peaking, the ride down wasn’t pretty.  Bitcoin quickly gave up value.  Bitcoin bottomed in value at $3,271 on December 16, 2018, almost exactly one year from the 2017 peak. 

Since that bottom, Bitcoin has traded in a narrow range of around $3,500 per coin.

The rise and fall and re-rise of Bitcoin makes one wonder whether the volatility of the world’s most renown cryptocurrency affected the actual usage of Bitcoin as a medium of exchange.

Here’s a look at transactions using Bitcoin over Bitcoin’s time span of existence.

Interestingly, Bitcoin transactions continue on a general upward trajectory.  With the exception of the December 2017 to March 2018 drop, people are still using Bitcoin for transactions and that usage is growing.

The most recent count has Bitcoin being used is about 275,000 daily transactions.  In the grand scheme of things, this is a very small amount, about 100 million annually, of the total number of transactions that happen worldwide every year.  Assuming say 5 transactions per person happens every day across the world, then there are around 13 trillion transactions in the world every day.  That’s almost assuredly a low estimate. 

The Future of Bitcoin

With Bitcoin transactions accounting for perhaps 0.0008% of all global transactions currently, one might wonder what the future holds for Bitcoin. 

The answer, it appears, is bright. 

Here’s an overlay of the price of Bitcoin (blue) and the number of daily Bitcoin transactions (red).  As indicated, even when the price of Bitcoin was experiencing some downward pressure, people still used the cryptocurrency for transactions.  And the usage of Bitcoin isn’t just growing, it’s growing quickly.  If current trends continue, Bitcoin transactions may reach 150 million by the end of 2019.  That’s nothing to scoff at.

Conclusion

Bitcoin has been through a wild ride, going from nothing in 2009 to a high of almost $20,000 in December 2017.  The price has settled closer to around $3,500 recently.  Through all the wildness of Bitcoin’s price, people continued to use the cryptocurrency as a medium of exchange, with Bitcoin accounting for perhaps 0.0008% of all global transactions.  If the current trend is any indication, Bitcoin has a bright future ahead, at least for its usage as a medium of exchange.