New Report Shows USD Leads Other Fiats in Trading Against Cryptocurrencies

Management and technology consulting firm GreySpark published a study during that week that revealed that the greenback is the most traded fiat currency against cryptocurrencies.


Management and technology consulting firm GreySpark published a study during that week that revealed that the greenback is the most traded fiat currency against cryptocurrencies.

The research report titled Charting the growth of cryptocurrencies pointed out that the U.S Dollars is the most actively traded fiat currency against cryptocurrencies over the past few years.

This doesn’t come as a surprise as most of the cryptocurrency exchanges have the USD or the Tether as their standard.

Bitcoin no longer the only game in town

The research by GreySpark was an in-depth one as it looked at several aspects of the cryptocurrency growth over the past few years.

The study noted that the cryptocurrency landscape has changed over the past 2 years. In August 2016, Bitcoin was the dominant cryptocurrency with a market dominance of 81%. Ethereum followed with 9% while the other cryptocurrencies shared the remaining 10%.

However, by August 2017, roughly seven cryptocurrencies had a market cap of over $1 billion with Bitcoin’s dominance dropping to 52%.

The number of cryptos with a market value of $1 billion has doubled over the past one year, which shows that the industry is growing.

Despite the drop in prices since the start of the year, interest in cryptocurrencies has continued to increase. GreySpark used Coinbase as an example, with the firm revealing that Coinbase continues to record new users despite the drop in Bitcoin price.

Correlation with Google searches

The firm compared the cryptocurrency prices with Google search interest. It found out that Google search for Bitcoin was very high when the price of the cryptocurrency reached its peak.

Searches for ‘bitcoin’ were at their highest in the week of the record Bitcoin price of $ 19,497 on December 16 2017, likely because news coverage of the appreciation encouraged would-be investors to get involved, or more casual observers to find out more.

However, the drop in Google searches is an indication that the Gold Rush event is over and the market is now on a path of less exciting but steady development.

Alternatively, it is possible that people who searched for the term earlier to learn what Bitcoin has had no need to learn it again later.

The research also revealed that the number of unique addresses continues to grow which is an indication that cryptocurrency transactions are on the rise. Both Ethereum and Bitcoin have experienced an increase in unique addresses over the past few months.

Cryptocurrencies are now a customer acquisition strategy

Perhaps, one of the biggest revelations is that cryptocurrencies are becoming investment strategies for many people. Fintech companies that have added a cryptocurrency feature have seen user numbers shoot up, doubling or even tripling their customer bases.

eToro is the most significant case which experienced a 200% increase in users after it enabled Bitcoin CFD as an investment instrument in 2014. Payment Company Square also experienced a similar growth after it enabled Bitcoin trading on its Cash App.

The paper also believes that the cryptocurrency market is catching up to the traditional finances. Even though the crypto market capital is still small compared to the others, it is catching up to them at a CAGR of over 550%.

At the growth rate shown by the company, cryptocurrencies would overtake the entire US stock market by November 2020.

Leave A Reply

Your email address will not be published.