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BCH, which was conceived as a way to make transactions fast and solve bitcoin’s congestion problem, now faces an awkward problem: 90 percent of its holders are Hodlers.
BCH was born out of BTC in August last year, promising to solve bitcoin’s high fees and meet the needs of everyday money transfers. But in reality, not many people seem to actually use BCH.
Chainalysis, a blockchain intelligence firm, says the vast majority of cryptocurrency enthusiasts use BCH more for investment than trading. In fact, there are more than 10 times as many BCH transactions in wallets as there are BCH transactions.
Chainalysis is a blockchain investigation company that investigates cryptocurrency money laundering, fraud and non-compliance in person. The company made its name investigating the Mt.Gox theft.
Compared to BCH, the amount of BTC used for investment is the same as the amount used for trading and speculation.
Chainalysis BTC and BCH in circulation divided into four categories, respectively speculative class (transfer back and forth between two addresses, and is small), transactional suppliers (by the encryption currency exchange and trading accelerate circulation platform (estimate is marketmakers) held), investment (personal purse held for a long time, and have a larger number of cash). Lost and undug coins (coins that are not available to anyone). The results are as follows:
Survey: Only 10% of BCH is used for trading
To explain the chart: speculative BTC: 5,090,000, exchange BTC: 2,190,000, investment BTC: 7410,000, lost and unmined BTC: 6,310,000. The lost and unexcavated BTC cannot be circulated on the market now, so as of April 2018, the total number of BTC in circulation on the market is 5,090,000 + 2,190,000 + 7410,000 = 14,690,000.
In other words, as of April, speculative BTC accounts for 5,090,000 ➗ 14690,000 =34.6%=35%; That’s 24 percent of the 21 million total. Similarly, 15% of the current circulation of BTC station held by the exchange and 50% of the long-term investment class.
The investigators classified the monetary quantities of the BCH in the same way. It turns out that only $1.5 million of BCH was used for speculation and trading, the rest for long-term investments.
Analysts say BTC’s ratio of trades to investments is about even, at 1 to 1(35%+15% : 50%), while BCH’s ratio is 1 to 10. In other words, 90% of BCH is almost never used for transactions, leaving the wallet address untouched. A comparison of BTCBCH is shown below:
Survey: Only 10% of BCH is used for trading
It’s worth noting that these numbers have changed significantly since the end of last year.
Since December 2017, a large number of investors have sold BTC and increased trading volume. BCH is a different story. About 15% of BCH was parked on exchanges or service providers as of November 2017, but the chips are now in big hands.
Of course, some question the scientific nature of the survey. A netizen named Jerry thinks that the daily trading volume of BCH is mostly expressed in USD, euro and Yen BTC, so it is not accurate to look at the trading activity solely by the trading volume of BCH.
Whether the survey results are distorted or not, or whether we need to reflect: the community has been emphasizing incentives for merchants to accept BCH payments, perhaps it’s time to consider how to encourage consumers to use BCH.