In the past few weeks, there has been a sharp uptick in Bitcoin volumes, fuelled mostly by emerging markets and crypto powerhouse, Japan.
The deteriorating Venezuelan economy has created a dramatic real-world demand for a stable global currency amid the economic tumult to which its population has become accustomed.
Crypto analyst, Mati Greenspan, revealed a surge in Bitcoin usage from the financially troubled South American country, reaching, at its peak, a 400% increase from the volumes recorded at the tail end of last year.
The eToro Senior Market Analyst said that Bitcoin activity can be seen to rise on a global level also, however, with the level of online volumes nearly reaching the dizzy heights recorded around the peak of crypto-fever at the beginning of the year.
Where are these volumes coming from?
Most people trading with cryptocurrency in first-world countries don’t need to use online trading services because they have easier access to centralized exchanges; Japan is the best indicator of this rule and accounts for over half of trades made. However, through online markets, such as LocalBitcoins, they have seen just 20 BTC exchanged this year.
While overall volumes traded through centralized exchanges have been steadily declining, the Japanese market seems to have shown an uptick. This, however, is possibly more affected by a weakening of the US dollar against the Japanese Yen.
The reliance of developing countries on online markets is unsurprising as the ability to hold currency outside of an unsteady government’s regulations can stand to benefit them the most. Sometimes a hostile environment exists for crypto, though, so expect to continue seeing a dearth of centralized exchanges in states such as Venezuela.
By going straight to the source you can check for yourself how many transactions per second are made on the Bitcoin blockchain – Blockchain.info tracks this and other data that can provide insight into recent trends on trade volume.
This being said, it is crucial to keep in mind that the Lightning Network is gradually increasing, which will naturally decrease the number of transactions on the main blockchain. Further to this, the market is always prone to rapid adjustments so traders and investors should always be prepared for a sudden change in the wind. With cryptocurrencies, a sharp uptick or dip in the market can happen at any time.
Callum reports on developments in the cryptocurrency world and offers a take on the future of the blockchain. Can often be found with a cup of tea reading an altcoin whitepaper.