According to new research from Bitwise, the public (and SEC) perceptions are wrong, and the real Bitcoin market is a poster-boy of order and efficiency.
Bitwise Asset Management certainly doesn’t sit around feeling sorry for itself when the SEC delays ruling on its Bitcoin-ETF… again. Just a week after the latest postponement, Bitwise submitted a 104-page white-paper on the true state of the market.
Fortunately, Bitcoinist read the whole thing and picked out the important bits so you don’t have to.
Market Obscured By Foggy Miasma Of Bad Data
The current data reported on trading volumes by market aggregators is surprising… because it is wrong. But it isn’t Bitcoin’s fault. CoinMarketCap (and many of the pillars of the crypto-community) evolved from tools for early enthusiasts, and are not indicative of the state of the Bitcoin market today.
So when we hear that BTC trades twice the daily volume of Apple, despite having roughly 10% of the market cap. Or nearly a third of gold’s daily volume, but less than 1.5% of its market cap. Then that data is surprising, but the fact that it is incorrect should not be.
Similarly, the fact that CMC reported a spread across exchanges (at a single point in time) from $5170 to $5873, would be shocking. But it isn’t a true representation.
Do The ‘Fake-Volume’ Exchanges Have Any Real Volume?
This was one question posed by the SEC after Bitwise submitted their previous research (upon which this expands) in March.
Bitwise collected custom-data on 83 exchanges, by utilizing screen-scraping and other techniques. Other than the ten ‘true-volume’ exchanges, only three exchanges seemed to have significant volume and a real-world footprint. These were HitBTC,