Executive Summary
- Bitcoin has evolved into a global asset with extremely deep liquidity that is available at all hours of the day. This creates the conditions for investors to speculate, trade, and express their macro-economic views at times when traditional markets are closed.
- Bitcoin continues to prove itself as an emerging store of value asset, accruing over $850B in net capital inflows. It also serves a role as a medium of exchange asset, processing nearly $9B in economic volume per day.
- Multiple metrics for new demand remain elevated, however they are substantially lower than was experienced during the heights of previous cycles.
- The composition of investors in digital assets is also changing, with a notable rise in more sophisticated institutional investors within the Bitcoin space. This has led to a general decline in the magnitude of drawdowns and a compression of volatility over time.