Bitcoin is in free fall, but one indicator is promising

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

If the price of Bitcoin has almost returned to its level at the beginning of the year, the craze for these digital assets remains very strong. The general public increasingly sees it as an alternative to invest its capital and generate substantial returns.

The AMF, however, never ceases to warn investors in the face of “too” easy greed. In the line of sight, trading platforms which sometimes offer additional levers to boost gains… but also risks!

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

500 million benefits in 2020

A study published by Chainalysis however asserts that the French generated 500 million euros in profit in 2020, just with Bitcoin. If it is positioned as the tenth nation in the world in terms of GDP, France is placed as No. 7 in this ranking carried out by the blockchain analysis company.

The yield of Bitcoin has been generous, especially if we compare it to the remuneration of the Livret 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 (at the rate of a yield of 0.5% gross). The total cryptocurrency market has seen an equally strong rise and the associated profits could even exceed the interest of the Livret A, according to our calculations. Currently, 3% of French people have bought Bitcoin and 14% wish to do so in the years to come.

Bitcoin income by country

Profit generated by country (2020) © Chainalysis

The cost of a transaction in (sharply) decreasing

After a period of euphoria in the first quarter, cryptocurrencies are going through a new period of uncertainty. The impact was instantaneous on the volume of transactions which collapsed considerably. With 214,000 transactions carried out on the single day of June 1, Bitcoin goes back almost 3 years, to August 2018.

However, this development implies good news: the fees charged by the Bitcoin network for each transaction are falling. While you had to spend an average of $ 62 per transaction during the month of April, the average cost of a transaction is around $ 5 currently (regardless of the amount traded). This drop should therefore support the smallest transactions, the profitability of which has been undermined in recent months.

Bitcoin transaction

Number of Bitcoin transactions © The Block Cypto


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