Bitcoin is in free fall, but one indicator looks promising

In the past 24 hours, Bitcoin has seen another 10% decline. The famous cryptocurrency is hovering around $ 33,000 this morning, a correction of nearly 50% from its all-time high ($ 63,500) in April.

When the price of Bitcoin has almost returned to its level at the beginning of the year, the enthusiasm for these digital assets will remain very high. The public increasingly sees it as an alternative to invest their capital and generate high returns.

However, the AMF never stops warning investors of “too” easy greed. In sight trading platforms that sometimes offer additional leverage to increase profits … but also risks!

The popularity of the keyword “Bitcoin” on Google Trends © Google

500 million benefits in 2020

However, a study published by Chainalysis claims that the French made € 500 million in profit in 2020 from Bitcoin alone. If it is positioned as the tenth nation in the world in terms of GDP, France ranks 7th in this ranking by the blockchain analytics firm.

The return on Bitcoin was generous, especially when compared to the remuneration of the savings book A. With an outstanding amount of 326.5 billion euros at the end of 2020, the latter generated around 1.6 billion euros in interest over the period (for a return of 0.5 % gross). The entire cryptocurrency market has grown just as strongly and the associated profits could even exceed the interest on savings book A according to our calculations. Currently, 3% of the French have bought Bitcoin and 14% want to do so in the years to come.

Profit by Country (2020) © Chainalysis

The costs of a transaction decrease (sharply)

After a phase of euphoria in the first quarter, cryptocurrencies are going through a new phase of uncertainty. The impact was immediate on the transaction volume, which plummeted significantly. With 214,000 transactions performed on the single day of June 1st, Bitcoin goes back almost 3 years to August 2018.

However, this development implies good news: the fees that the Bitcoin network charges for every transaction are falling. While you spent an average of $ 62 per transaction in April, the average cost of a transaction is currently around $ 5 (regardless of the amount traded). This decline should therefore support the smallest transactions whose profitability has been undermined in recent months.

Number of Bitcoin transactions © The Block Cypto


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