Following an extended period of sideways trading, the cryptocurrency markets dropped today as Bitcoin failed to hold above its recently established support level at $3,800. BTC’s drop below this level has led many cryptocurrencies to plunge 5% or more, signaling that greater volatility is likely to come as the week continues on.
Despite the current state of the markets, analysts are quick to point out that the number of transactions per block for Bitcoin are nearing their previously established all-time-highs that were set during the height of the bull run in December of 2017.
The Bitcoin network experienced more than 490,000 daily transactions which were notably at the time of the historic crypto market bull run when the price of Bitcoin made tremendous gains to its all-time high of $20,000.
Even though the number of Bitcoin transactions has surged, the price of the leading cryptocurrency hasn’t been able to recover to it’s larger prices.
There are many experts that have argued that there isn’t a meaningful correlation between the daily Bitcoin transactions the cryptocurrency’s price. There are several factors that this could be down to such as crypto traders being able to easily short Bitcoin and having access to crypto derivatives like Bitcoin futures.
In addition to this, the volume of Bitcoin transactions has increased due to the increasing popularity of the Lightning Network. For those that are unaware, the LN is a two-layer crypto payment solution that allows digital asset transfers to be processed in a quicker and more cost-effective fashion. Furthermore, the adoption rate for Bitcoin has seen a very significant increase of 700 percent over the last six years.
The cryptosecurity company based in Moscow, Kaspersky Labs recently shared the results of one of its surveys which revealed that more than ten percent of global shoppers had used Bitcoin or another cryptocurrency to pay for goods and services bought online.
Even though cryptocurrency was still the least popular option for online payments, the business lead at the Russian firm said, “despite a fall in cryptocurrency prices, there is still a strong desire for digital transactions amongst consumers. Our consumer research has found [a significant number of consumers are using cryptos for payment], which was surprising to see.”
