[2017-04-17]Bitcoin is Now Larger Than Some Fiat Currencies in Europe & Americas

[xijieboy-8]

Bitcoin is Now Larger Than Some Fiat Currencies in Europe & Americas in Market Cap
The user base and market cap of bitcoin are larger than most fiat currencies of small countries in Central America, Africa and Europe. The next step for bitcoin is to surpass the market cap of reserve currencies, to establish itself as the global currency used by mainstream users and general consumers.

The truth is, bitcoin as a technology is not capable of surpassing the value or user base of reserve currencies as of yet. Various scaling issues have to be addressed and solutions must be implemented. One of these solutions is Bitcoin Core’s Segregated Witness. If both the on-chain capacity and two-layer solutions of bitcoin are expanded and improved, bitcoin will be able to compete with larger fiat and reserve currencies of the world.

Still, the bitcoin network has demonstrated a significant rate of growth in terms of market cap and user base. Most notably, Blockchain, a popular bitcoin wallet platform, recorded over 6 million new users in the past 12 months. Other competing wallet platforms such as Coinbase have also shown a rapid growth rate, with the Coinbase wallet platform serving over 6 million users.


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Coinbase and Blockchain alone are currently serving nearly 20 million wallet users. Apart from these regular day-to-day users, there exists many investors in regulated bitcoin exchange and trading platforms such as BitFlyer, Bitfinex and Bitstamp that hold bitcoin as an investment.

According to an infographic provided by a user of a bitcoin online community, the userbase of bitcoin is larger than many countries including Norway and Finland. The market cap of bitcoin is higher than the majority of fiat currencies in the world. Bitcoin has a higher market cap than the currencies of the following countries:

Mongolia, Bolivia, Paraguay, Papua New Guinea, Thailand, Laos, Sudan, Senegal, Nigeria and more. The full list of countries can be seen in the infographic shown below:

Importance of Scaling For Bitcoin Mainstream Adoption

Bitcoin, as noted in Satoshi Nakamoto’s original white paper, was designed and introduced to operate as a peer to peer electronic cash system. Due to its high fees and relatively long confirmation times however, since 2015, bitcoin has begun to operate as digital gold. In order for bitcoin to appeal to the masses, it needs to be able to handle small payments that are cheap, secure and fast. In other words, for bitcoin to surpass the value of reserve currencies and obtain a massive user base, it has to refer back to Nakamoto’s original vision of bitcoin.

Technologically, bitcoin is not there yet. The open source development community of bitcoin is working toward adding a settlement layer on top of bitcoin so that it can operate as both digital gold and settlement network. Technologies like Segwit, Lightning and Tumblebit are all designed to add that second layer of infrastructure to handle small payments for day-to-day users.

In a way, the comparison digital currencies such as bitcoin to fiat currencies or reserve currencies that are actively utilized by their users on a daily basis could be incoherent. However, if bitcoin is used as a digital cash system as Nakamoto outlined in 2009 in the future, then this comparison could be more relevant.
https://www.cryptocoinsnews.com/bitcoin-now-larger-fiat-currencies-europe-americas-market-cap/

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[Qartada]

Very misleading way of looking at it.  Bitcoin's hasn't really surpassed these fiat currencies at all because:

-Fiat currencies are localised as they are the legal tender of a country.  Bitcoin would only be larger than them if the amount being held in that area was higher than the amount of fiat currency being held.

-Bitcoin's market cap is not the same as fiat's market cap because most of it is not in circulation and Bitcoin has many different features to these conventional currencies.  Much of the price isn't from people who spend it regularly but is from investors which also manipulates the market cap in relation to fiat.

[Carlton Banks]

Your assessment is not altogether correct either, Qartada.

-Fiat currencies are localised as they are the legal tender of a country.  Bitcoin would only be larger than them if the amount being held in that area was higher than the amount of fiat currency being held.

The amount of M1 BTC (of which Bitcoin can only represent, the monetary components M2, M3, M4 etc aren't possible in the Bitcoin system, and that's a good thing), is higher for Bitcoin than many small fiat currencies serving small economies (although I'm not too sure how Norway or Finland M1 got cited, I've not checked recently, but I would guess those currencies still to be larger than BTC M1)

-Bitcoin's market cap is not the same as fiat's market cap because most of it is not in circulation and Bitcoin has many different features to these conventional currencies.  Much of the price isn't from people who spend it regularly but is from investors which also manipulates the market cap in relation to fiat.

OK, M1 money supply equivalence (or "market cap" as the article erroneously describes) and velocity of money are not the same metrics at all, and you conflate them with one another in your post. But you are right in 1 way, Bitcoin velocity is much lower than some of the fiat currencies for which it's M1 supply exceeds.

But also, remember how fiat currencies attain their market value in the first place: currency market trading, which is simply speculation by another name. The general market doesn't determine the value of currencies on the currency markets, it's the currency markets that determine the value of currencies in the general market. The value of fiat currencies is set by a centralised system, not by a decentralised system (even the BTC price is set this way, not just anyone can open a Bitcoin exchange).

[buwaytress]

The only way BTC can be "larger" than some fiat currencies mentioned in the list is if numbers are manipulated, which clearly is the case if you go into it.

The most basic logic will tell us that it's impossible for Bitcoin, which has a lower than 1% global adoption, much less in many of the countries listed there. Thai Baht, for example, with the number of tourists visiting each year alone possibly more than Bitcoin users, each spending thousands of dollars worth of Baht can't be "smaller" than BTC!

If you use the argument that these fiat are also inflated by forex, then BTC will lose even further on those grounds if crypto exchanges are taken out of the equation as many of the listed countries are considered as "exotic pairs" and only traded in their subregions.