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Bitcoin [BTC]: Data Scientist’s research suggests Satoshi’s vision achieved; Bitcoin has global penetration

Jibin M George

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Bitcoin [BTC]: Data Scientist's research suggests Satoshi's vision achieved; Bitcoin has global penetration
Source: Pixabay

Bitcoin was created with the intent of devising a global currency that cut the middleman from financial transactions and allowed a fully decentralized peer-to-peer network to handle financial transactions without the involvement of authorities such as banks or national governments. Data Scientist Matt Ahlborg attempted to address questions about whether the coin has been able to enter global consciousness, in a research paper he published on Medium.

The paper, published yesterday suggests that despite the many issues Bitcoin has faced over the years, has justified its existence by working as Satoshi originally intended it to. Ahlborg argues in favor of this stance by looking closely at trading volumes data he obtained from LocalBitcoins.com.

According to his research inferred from the obtained data, Ahlborg has suggested that despite the fact that Europe and North America were the first to embrace cryptocurrency, daily trading volumes in Asia and Latin America, led by Venezuela, are slowly dwarfing that of the first world.

More interestingly, Ahlborg uses a new metric to quantify and analyze the degree of Bitcoin adoption across the world. The metric, Usage per [Online] Economic-Person, or UP [O] EP was devised by him to correct for differentials in the value of fiat currency against the US Dollar in different parts of the world. Using this new metric and a global animated chart, Ahlborg’s studies made some very interesting findings that back his hypothesis about Bitcoin’s success.

For starters, the data suggests that UP [O] EP levels have steadily increased in countries that score low on economic freedom and have imposed on their citizens financial and monetary restrictions. In such countries, China and Venezuela for example, these restrictions have involuntarily catalyzed and accelerated the conditions for adopting cryptocurrencies such as Bitcoin. However, this isn’t a cent percent inference as some factors such as a high level of technical literacy, internet and smartphone penetration etc contribute significantly to the same.

Secondly, countries such as Turkey and India, which have fair conditions for the adoption of cryptocurrency, however, have not taken flight yet. This, Ahlborg’s research suggests, is due to a multitude of factors which include local laws, customs, culture, and ingrained habits.

Finally, his research also suggests that while the wide use of cryptocurrencies in the developed world has stalled somewhat, the market is booming significantly in the third world. In fact, as the data from LBC suggests, 21 countries, most of them of the third world, posted their highest ever Bitcoin trading volumes last quarter. These countries were led by Venezuela, whose trading volume three years ago was less than 1% of its present value. The South American country is followed by Colombia, Panama, Chile, Argentina, Belarus, Kazakhstan, Egypt, Japan and even, Sudan and Afghanistan.



Ahlborg does however accept some gaps in his research. For starters, he only uses data collected from LBC, one that charges a high transaction fee, instantly dissuading a huge set of cryptocurrency traders. Secondly, with the rise of many cheaper exchanges, especially in the first world, the number of trades in the United States and Europe may be a tad under-represented.

These gaps, however, Ahlborg feels, should not undermine the significance of his findings with this research. His finding, that Bitcoin has been successful in fulfilling Satoshi’s vision by penetrating world economies and be of utility to people of all backgrounds is one that he feels, will stand in the face of more in-depth research.





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1 Comment

1 Comment

  1. Avatar

    Andy Clark

    February 9, 2019 at 10:02 PM

    IMO No new ‘actual cash’ is going into crypto. They just buy/sell within the cryptosphere to create an illusion of a market. Reality is crypto is scary to 96% of human beings and is so thinly held and subject to all sorts of wallet scams…. it borders upon organized crime.

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Analysis

Bitcoin [BTC]: King coin’s Golden Cross confirmed; Greenspan hints at bullish market

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Bitcoin [BTC]: King coin’s Golden Cross confirmed; Greenspan hints at bullish market
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Bitcoin’s much-awaited Golden Cross, which many analysts claimed will lead to a resurgence of a bullish market, has been confirmed. The intersection of the 200-day moving average and 50-day moving average, which indicates the Golden Cross, was achieved over the past few hours.

Earlier today, the top cryptocurrency saw a massive rise after days of sideways movement. Bitcoin’s ascendance saw it break the $5,350 resistance level, which eToro’s Mati Greenspan had previously suggested will consolidate “buying pressure.”

Source: TradingView

Additionally, a major psychological level of $5,500 was also surpassed less than three weeks after Bitcoin broke the $5,000 mark.

The Golden Cross theory holds credibility among analysts in the cryptocurrency realm as it infers that the coin’s average price is above its 200-day equivalent. For the first time in over a year, the cryptocurrency market has seen its 50-day MA move above the 200-day MA, which according to many is a sign of a bullish market.

On the opposing side of the Golden Cross indicator is the Death Cross, where two indicators cross over into a bearish market i.e. the 200-day MA moves above the 50-day MA. The Death Cross manifested in April 2018, after the prices went into a free fall following the December 2017 high.

In April 2018, BTC was priced at just over $7,000, following which it lost more than 50 percent of its price by the end of the year. The price of the king coin has recovered exceedingly well in 2019 however, winning back almost 50 percent of its lost value.

Many analysts, including Greenspan, agree that the crossing of the two moving averages is a clear testament to the return of the bull market. Although he didn’t quite use those words, Greenspan tweeted,

“Ladies & Gents… The Golden Cross!
Bitcoin’s 50-day moving average (gold) crossing above her 200-day moving average (blue). 📈
This is yet another sign that we’re back in a🐂market. 🚀🌛”

However, in an exclusive interview with AMBCrypto last week, Greenspan had stated that the Golden Cross theory is a “lagging indicator,” as the Death Cross was last seen in April 2018, months after the market took a bearish turn.



In his view, the 200-day moving average is the key indicator. On April 2, Bitcoin broke this mark for the first time since March 2018, by recording a massive 17 percent daily gain and rising above $5,000.

Based on historic price changes with reference to the Golden Cross, the last time the 50-day MA soared above the 200-day MA, price of Bitcoin rose by over 8000 percent from $246 in October 2015 to almost $20,000 in December 2017. Given past market movements, the current market scenario, and the optimism in the air, the Golden Cross may just have initiated the Bitcoin bull market.





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