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Author Topic: Where's the data for fundamental growth of Bitcoin?  (Read 1031 times)
Kato
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March 25, 2013, 07:03:19 AM
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I've seen much debate in this forum and elsewhere over whether Bitcoin is a bubble or not. Most of this seems to be ideological instead of fundamental. Unfortunately Bitcoin transaction data is distorted by currency exchange, transfers to self-related entities and the like, and not necessarily indicative of goods and services transactions. Is there any data available on the uptake of Bitcoin by merchants, levels of sales growth or the like? If we have data then at least the conversation can become more civil and turn to growth and valuation rather than shooting at stars. Can anybody start pointing to such data so we can begin collating it?
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March 25, 2013, 07:08:43 AM
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The amount of BTC-> actual good/services transactions would be an extremely valuable metric.

I imagine it could be done loosely with the right algorithm analyzing the blockchain.

Anyone know of such a thing?

But what that can't tell you is potential utility. 

And that right now, I believe triumphs current utility many times because we are still so early in the adoption phase.
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March 25, 2013, 07:56:52 AM
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You might not be able to learn exactly how many BTCs are used on goods and services, but you might be able to get the next best thing, assuming the major BTC exchange public keys are known.

A metric of the number of transactions and the amount transferred with the major BTC exchanges compared to the number of transactions total would be useful.  You could probably pull that off the block chain, right?  We could assume that the transactions not on the major exchanges would mostly be private exchanges for goods and services and transfers of money between individual's accounts for purposes of things like secure backup, right?  If 90% of the BTCs transferred were transferred on exchanges people would treat BTC differently than if only 5% was transferred on exchanges.

A metric like that might undermine the value of the BTC, and I'm guessing most devs don't want to risk that.  On the other hand, it might strengthen the market.  It would be a great way to shut people like Krugman up if you could prove that there is reason to believe that people are using BTC for transactions rather than pure speculation.

rpietila
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March 25, 2013, 08:04:26 AM
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I believe the market is driven by buyers that have faith on that bitcoin will ultimately be able to offer some, yet limited, transaction opportunity (like you can transact with gold). Despite the fact that Bitcoin is a transfer protocol, I don't believe the value primarily depends on that.
Kato
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March 25, 2013, 09:15:54 AM
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You might not be able to learn exactly how many BTCs are used on goods and services, but you might be able to get the next best thing, assuming the major BTC exchange public keys are known.

A metric of the number of transactions and the amount transferred with the major BTC exchanges compared to the number of transactions total would be useful.  You could probably pull that off the block chain, right?  We could assume that the transactions not on the major exchanges would mostly be private exchanges for goods and services and transfers of money between individual's accounts for purposes of things like secure backup, right?  ...

Thanks bubblesort. That sounds like a good idea to start with. I know that at the blockchain.info site (http://blockchain.info/charts) there are charts on estimated transaction volume as well as exchange traded volume, so the data looks to be there. I also note there is a chart of the Trade Volume v Transaction Volume Ratio, but its specification makes it very jumpy and difficult to interpret. Something along the lines of Transaction Volume less Trade Volume might perhaps be more insightful. If you know a way of extracting this numerical data, I am all ears. Cheers.

I still think some fundamental spending trend data, if any exists, would do a lot to inform the investor base and give more confidence for a broader range of potential merchants to participate. So if anybody else has ideas, keep them coming. Thanks.

lebing
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March 25, 2013, 01:38:27 PM
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https://bitcointalk.org/index.php?topic=143973.0

Bro, do you even blockchain?
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March 25, 2013, 02:01:29 PM
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Probably have to do it the hard way: find a list of Bitcoin businesses, count them up, make estimates, or just flat-out ask them how much trade they do in bitcoins.
johnyj
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March 25, 2013, 04:55:16 PM
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Avalon team is now the fundamental support of bitcoin economy, their latest batch 3 sale generated 50K bitcoin economic activity Grin

Kato
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March 26, 2013, 12:00:31 AM
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Hey thanks for the references everyone. The forum topic on fundamentals provided by lebing is mainly a list of news items rather than fundamental data, but thanks for this anyway. However the Bitpay announcement linked by 100x has some interesting comments in it in growth in merchants and goods and service transactions. This is a useful start. I wonder if Bitpay will provide more data, which would help everyone. Might ask them.
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