This morning has been particularly frustrating from a "find something to write about" perspective. Truly at a loss for (what I deem to be) meaningful words at the moment.
As with every facet in life, when you find yourself in a confused or lost state, out of breath and looking for solutions; it's always a good idea to step back, take a few deep breaths and fall back on fundamentals.
No better day than today to look at some data on Bitcoin's network fundamentals. Follow me as we take a journey around the Internet from data site to data site, documenting the charts we like along the way.
If we take a one-year look back from today, we can see that network hashratecurrently stands at 39 exahashes per second after only being at 17 exahashes per second this time last year. At one point in the last year network hashrate reached 64 exahashes per second! As you can see in the top chart, Bitcoin's difficulty adjusted up and down many times throughout the year as it the protocol dynamically reacted to the amount of sheer computing power entering and leaving the system. The adjustment exists to ensure that blocks are produced roughly every ten minutes.
Here's a snapshot of the growth Bitcoin's chain size over the last year coupled with the annualized growth rate of the chain size. It is important to keep an eye on chain size as we want to ensure that it remains below a threshold that allows your average Joe to run a Bitcoin full node if he felt so inclined. On this day last year, Bitcoin's chain size was 155.3GB with an annualized growth rate of 39.1%. Today, the chain is sitting at 202.3GB with an annualized growth rate of 26.9%. Very encouraging, if you ask me. It seems like the pace of chain size growth on Bitcoin's blockchain is actually slowing as upgrades made throughout the years work to make the use of block space more efficient. You can even use the eye test to see the slope of the chain size line flattening a bit in March (and maybe August) of last year.
The price of Bitcoin has fallen pretty hard over the last year, but the median transaction value in USD has fallen even harder; experiencing a drop from ~$1.15k to ~$65. Falling back to late-2016, early-2017 levels. On top of this, overall payment count is down to about 350k/day from ~422k/day this time last year. Payment counts have become rangebound, signaling to me that people may not be using Bitcoin as a payment network as the price has decreased. Though, it seems like payment count may be stabilizing.
Overall weekly volume on LocalBitcoins seems to be stabilizing around $50M. While this is promising, what is really interesting is to see the amount of trading volume in BTC in countries like Venezuela and Russia where Bitcoin's utility is more appealing than in the West. It would seem that Bitcoin is being used by the people who need it most, but we must also acknowledge that the corrupt political elite in these countries could be driving some of this volume as well.
(I KNOW IT LOOKS LIKE THESE CHARTS ARE DENOMINATED IN BOLIVARS AND RUBLES BUT I PROMISE THEY ARE DENOMINATED IN BTC. COIN.DANCE LOVES TO ANNOY PEOPLE.)
The number of Bitcoin Days Destroyed are on the way back down after spiking towards the end of last year. A spike in days destroyed signals that longtime holders or exchanges with cold storage that hasn't been touched in a while are moving coins. Some like to use this stat to help guage when whales are taking profits or rage quitting on the market. This is by no means a perfect measure, but it fascinates the hell out of me. A fall in days destroyed may signal the end of selling from some longtime holders.
The amount of Bitcoin Core full nodes that we know about has spiked up, fallen >10% and recovered a bit over the course of the last year. As of today (at least according to coin.dance), there are ~9.7k Bitcoin Core full nodes around the world contributing to consensus. Gonna need to pump these stats as we move forward. Rookie stats if you ask me.
And that was Fundamentals Thursday with Uncle Marty. This certainly will not be a weekly occurrence here at the Ƀent and may even fall on a different day if it ever does resurface in the future.
Nothing warms the soul during a polar vortex like Reggae music. Find your beach, freaks.