Bitcoin comes back from fringes to mainstream
Even with a big selloff on Thursday, bitcoin’s rebound toward all-time highs this week is no sign of a speculative bubble but the growth spurt of a major asset class in the making, say crypto diehards.
Just look at market technicals and Wall Street’s growing embrace of the world’s biggest digital currency. And while the trading doesn’t always run smoothly, the $315 billion digital coin is far deeper and more liquid than it was during the last boom in 2017. “Bitcoin has the potential to become for our global monetary economy what the internet has been for our global society,” said Tancredi Cordero, founder of Kuros Associates in London. “The main concern and turning point for Bitcoin are trust, adoption and regulation.”
Explaining Bitcoin’s growth: Network effect
The number users continues to grow, giving it an advantage that’s hard for rivals to surpass. There are now more than 30 million wallet addresses with active balances, according to ByteTree.com and Glassnode.
Market depth
The rapidly expanding bitcoin futures market at CME Group is another example of the convergence in crypto trading and mainstream finance.
Backlogs cleared
In 2017, one of the issues plaguing the market were long delays for transactions to be executed. The problem has largely been addressed through software changes and pooling of transactions.
Computing muscle
Computing power devoted to running the Bitcoin network has soared over the past two years. The has rate, a term of measurement, has grown exponentially reflecting greater investment in computers to turn around transactions and record them faster on the blockchain. –