5 charts tracking Bitcoin adoption

Bitcoin is a global socioeconomic experiment that has recently become increasingly used as a store of value for countries like Venezuela and Zimbabwe.

On January 3, 2009, the Genesis block, the first Bitcoin block, was mined. Satoshi Nakamoto also left an excerpt from the front page of The Times newspaper in the Genesis block:

"Second bailout for banks looming" - The Times, 3 January 2009

This is not a coincidence, this is exactly what Bitcoin was created for.

We believe that Bitcoin will continue to provide a store of value for those who see their savings and assets decline in value due to inflation.

To validate this idea, this article will highlight several charts that show real-time data representing the growing adoption of Bitcoin around the world.

1. bitcointreasuries.org

Bitcointreasuries.org tracks the amount of Bitcoin held by Public, Private, and EFTs like companies , a good indicator of institutional interest in Bitcoin. At the top of the list is MicroStrategy, which is the largest holding of a public company (71,079 BTC ). In terms of ETFs, Grayscale Bitcoin Trust is in the lead (649,130 ​​BTC). At the time of writing (February 5, 2021), the total Bitcoin held by companies listed on bitcointreasuries.org accounts for 5.87% of the total Bitcoin supply.

2. Grayscale Bitcoin Trust

As mentioned above, Grayscale Bitcoin Trust is the largest Bitcoin exchange- traded fund (ETF) product currently available. Investment firms that are unable to purchase Bitcoin directly due to regulatory obligations can invest through ETFs. Grayscale is a pioneer in this space. ETFs purchase Bitcoin on behalf of institutional investors at a slightly higher price.

In the image below, you can see the blue bars representing the growth of the fund size. As of February of this year , the fund held less than 650,000 Bitcoins. As institutional interest in Bitcoin continues to grow, we can expect this number to continue to rise. In addition, you can see the correlation between price (red) and holdings growth (blue). The link below shows the daily real-time holdings values.

3. S2F Model

The stock-to-flow model (S2F model) is used to evaluate the current stock of a commodity (the total amount of BTC currently available) versus the flow of new production (the amount of BTC mined in that particular year).

Basically, the chart shows the expected Bitcoin price direction based on the decreasing supply of new Bitcoins being mined . Something to know: Bitcoin's supply decreases over time, so it's naturally deflationary.

Currently, approximately 900 BTC are mined per day. If, in the long run, the average daily demand for Bitcoin is above 900, then we can expect the price of Bitcoin to rise over time. Here is what the model shows. Companies like Grayscale themselves regularly buy over 900 Bitcoins per day. In November 2020, they bought over 15,000 Bitcoins in a single day .

4. r/Bitcoin

The r/Bitcoin subreddit forum is the largest online community dedicated to Bitcoin. With over 2.2 million subscribers, it is currently one of the fastest growing channels on Reddit. This online community shares insights, memes, and content about Bitcoin and has become an important voice in the Bitcoin community.

As shown below, the forum continues to grow in subscriptions as more and more people are attracted to Bitcoin, another important indicator of Bitcoin adoption.

5. WBTC

Since Ethereum and DeFi allow individuals to access Dapps and financial services, it opens the door to other use cases for Bitcoin. WBTC issued on Ethereum is a Bitcoin in ERC20 format.

The chart below shows the number of various BTC-pegged coins issued. As the number of Bitcoins on the Ethereum network increases, there will be fewer and fewer Bitcoins available for purchase on exchanges. This puts further pressure on supply.

The above five graphics help you get a good idea of ​​the current state of Bitcoin adoption , and these data are publicly updated and can be viewed at any time. The Bitcoin landscape is changing rapidly, and I believe these five data points can provide a lot of important information.

Since there will only ever be a fixed total of 21 million Bitcoins, as more and more Bitcoins are locked up in corporate balance sheets, investment funds, and the Ethereum network, there will be fewer and fewer Bitcoins available. This is the supply and demand dynamic that will drive Bitcoin's price in the coming years, and why many people around the world choose Bitcoin as the ultimate store of value.

Article reference:

https://finstacks.medium.com/