Bitcoin has been going sideways while the rest of crypto has been surging ahead

While bitcoin has been taking a nap for these past couple months, basically ever since its halving, much of the rest of crypto has been doing very well.

Mostly lead by Defi.

The relatively stable price action and activity levels have lead to another coin overtaking bitcoin as the mostly widely used in all of crypto.

At least in terms of total value settled...

As I type, Ethereum now settles more total value than bitcoin does on a daily basis.

Check it out:

(Source: https://messari.io/article/q2-20-review-stablecoins-at-the-heart-of-defi-boom)

The flippening happened in a few days ago and isn't showing any signs of stopping or slowing down any time soon.

While bitcoin continues to mostly chug along, the value being settled across the Ethereum network continues to go up and up and up.

Why the sudden increase for Ethereum?

The sudden increase in value being settled by Ethereum network can be summed up in one word...

"Defi"

Based on the chart and research done by messari (https://messari.io/article/q2-20-review-stablecoins-at-the-heart-of-defi-boom), the majority of the new created valued is coming via stable coins.

In 2019, stable coins accounted for $253 billion in settled volume.

In 2020, stable coins have accounted for over $508 billion in settled transactions already.

The total stable coin market now amounts to roughly $12 billion worth of value, while it started the year worth roughly $2.4 billion.

For those doing the math, that is a 6x increase in roughly 6 months.

The king in all of this remains USDT as it is worth roughly $10 billion of that $12 billion market, and it may soon surpass bitcoin in terms of transaction volume:

(Source: https://messari.io/article/q2-20-review-stablecoins-at-the-heart-of-defi-boom)

Bitcoin not likely to lose it's crown any time soon...

This doesn't mean bitcoin is going away any time soon or about to lose its crown as the most valuable cryptocurrency though, in fact I'd argue that all of this newly created value is ultimately going to be very good for bitcoin.

It's pulling outside money into crypto, money that may eventually find its way into bitcoin if it starts seeming some momentum again.

I like to look at is as roughly $12 billion worth of dry powder sitting in the crypto markets that could jump into bitcoin at any time given the right catalyst.

For this reason, I'd venture to say that ethereum and defi's gains are also bitcoin's.

Stay informed my friends.

-Doc

Posted Using LeoFinance