For the longest time, Bitcoin (BTC) has been deemed useless by mainstream economists, investors, and others.
For instance, per previous reports from Blockonomi, LendingTree Chief Economist Tendayi Kapfidze told Yahoo Finance in an interview that he thinks Bitcoin is a “pyramid scheme,” citing his sentiment that you can “only make money [with BTC] based on people who enter after you.”
He added that Bitcoin “has no real utility in the world. They’ve been trying to create a utility for it for ten years now. It’s a solution in search of a problem and it still hasn’t found a problem to solve.”
But, a recent transaction recently was processed on the world’s foremost blockchain that seemingly proves that the cryptocurrency has real-world value.
$1.1 Billion Moved In Crypto For… $84
Yesterday sites tracking transactions on the Bitcoin blockchain noticed something interesting had transpired: over 100,000 BTC, valued at around $1 billion flat as of the time of the transaction, was sent from one address to another, these being revealed to be both managed by cryptocurrency exchange Bitfinex.
While this was not news in and of itself per se, the fee on the transaction quickly became news.
- Bitfinex transacted the massive sum for a jaw-dropping sum of $84, meaning that the fee was around 0.0000084% of the entire transaction.
- Not to mention, Bitfinex likely overpaid with the $84 fee, for it easily could have set a much lower rate, maybe around $10 to $20 or even lower (depending on inputs and outputs), and still have seen their BTC transaction get through the blockchain in good time.
As cryptocurrency content creator “The Moon” pointed out in the wake of this transaction in an attempt to show the benefits of BTC:
Today, someone moved $1,100,000,000 worth of #Bitcoin, and payed a ridiculous fee of $84!
With Gold this would have cost you tens of $millions!
With the FIAT system this would have taken several days to confirm!
With BTC, this transaction cleared in just a few minutes!
— The Moon (@themooncarl) January 15, 2020
Bitfinex has made a similar transfer yet again, transferring a very similar amount of BTC value as the aforementioned transaction and incurring a very similar cost. The fact that these two transactions went through back to back is rather bullish for the cryptocurrency, some say.
As Yassine Elmandjra, the crypto-asset analyst at ARK Invest, wrote on Twitter in the wake of a previous large transaction, “[this is a] beautiful display of Bitcoin as a trust-minimized global settlement system.”
These transactions may be bullish for the Bitcoin market itself. On-chain analyst and Adaptive Capital partner Willy Woo recently posted the below chart, showing that BTC’s investor activity indicator, most likely derived from on-chain data, is suggesting that bulls are not yet in control.
These large transactions may swing this indicator to suggest that more bullish momentum is ahead for the price of BTC.
Using on-chain investor activity, which gives a read of where this may go; LTC is already very bullish, while BTC is still consolidating around an early bullish swing. pic.twitter.com/lLslSCSJuA
— Willy Woo (@woonomic) January 10, 2020
Not a Currency Yet
While these two transactions show the power of Bitcoin as a form of money, pundits in the industry aren’t too sure that the cryptocurrency is ready to become a globally-adopted currency in its current form.
In an interview published last year, Jack Dorsey, CEO of Twitter and Square and one of the most prominent Bitcoin bulls, was quoted as saying that BTC isn’t “functional as a currency,” seemingly making reference to the base layer processing speed of seven transactions per second, which pales in comparison to the (centralized) PayPal, Visa, and so on. Dorsey added:
“The peaks and troughs are like an investment asset and are equivalent to gold. What we need to do is make it more usable and accessible as a currency, but it’s not there yet.”