[co-author: Jordan R. Silversmith]
Stablecoin Activity Heats Up, Bitcoin’s Speculation Problem and Other Payments News
By: Brian P. Bartish
Despite the increase in major companies opening up payment options in bitcoin, research from Chainalysis shows that only 1.3% of bitcoin transactions came from merchants in the first four months of 2019, starkly contrasting with exchange activity that accounted for 89.7 percent of transactions during that same time period. According to data from the Commodity Futures Trading Commission, Bitcoin Futures contracts exchanged on the Chicago Mercantile Exchange hit a record high between May 27 and June 3, with more than 5,190 contracts outstanding, and many people suggesting increased institutional participation as the reason for the uptick. According to a recent report, interest in bitcoin investment among the superwealthy may lead to a new industry of “boutique” cryptocurrency brokerages, such as the Dadiani Syndicate in London, which coordinates peer-to-peer transfers, avoiding traditional exchanges, including one client who was interested in purchasing 25 percent of all currently available bitcoin.
Data published by blockchain news outlet The Block noted a positive correlation between GDP per capita and cryptocurrency traffic per capita and found that the U.S. accounts for 24.5 percent of total traffic on cryptocurrency exchanges, the most of any country by a significant margin. However, when measuring traffic on a per capita basis, other nations, including Singapore, South Korea and Switzerland, outstrip the U.S. Despite reports of widespread cryptocurrency trading manipulation, recent analysis is offering a new perspective, as trends in overall trading volume appear to correlate with on-chain transfers of the stablecoin tether to cryptocurrency exchanges, particularly in the Chinese market, which accounts for 60 percent of all on-chain transaction value for tether so far in 2019.
Cryptocurrency exchange OKCoin…