Bitcoin is World’s 30th Largest Currency, Market Cap Nears Mastercard’s $171 Billion
Goldman Sachs' chief economist believes the global economy has already bottomed out, despite slow growth. | Source: Shutterstock
Trace Mayer, a prominent early-stage bitcoin investor who has funded Kraken, Armory, and BitPay, revealed that bitcoin is already the 30th largest currency in the world, and has surpassed the value of major fiat currencies such as the Singapore dollar and the United Arab Emirates dirham, closing on the market cap of Mastercard.
Bitcoin Overtakes Leading Fiat Currencies
From January of 2017 to November, the market valuation of bitcoin increased from less than $15 billion to $156 billion. That is, without the entrance and involvement of institutional investors, investment banks, and large-scale hedge funds.
Coinbase CEO Brian Armstrong noted that approximately $10 billion in institutional money will be invested in the bitcoin market in the upcoming months, which will likely increase the market cap of bitcoin by over a hundred billion dollars.
Still, with only a handful of major financial service providers and institutions actively providing bitcoin services and engaging in bitcoin trading, the market cap of bitcoin has surpassed the valuation of some of the world’s largest financial firms, such as Goldman Sachs. Analysts expect bitcoin to surpass Mastercard, the second most widely utilized credit card network behind Visa, given Mastercard’s $171 billion market cap.
Mayer emphasized that every indicator of bitcoin points towards a healthy and strong upward momentum in the short to mid-term.
“Bitcoin is now a solid top-30 world currency. $9,000 price and $150 billion market cap only tip of 1st root of 1st network effect of 7. Healthy uptrend. 200DMA $4,001 and rising approximately $30/day. 200DMA market cap nearly $65 billion & rising around $500 million per day. $9k/4k=2.25x; nowhere near overstretched. Onward and upward,” wrote Mayer.
Dominance Index Fallacy
Analysts in the cryptocurrency sector often misinterpret the bitcoin dominance to criticize the growth rate of bitcoin and the emergence of alternative cryptocurrencies (altcoins). However, the cryptocurrency market is composed of a variety of crypto-assets, tokens, and currencies that are fundamentally different from bitcoin, serving different markets and consumer bases.
Hence, it is not rational to assess the growth rate of bitcoin through the bitcoin dominance index, which demonstrates bitcoin’s growth relative to other crypto-tokens in the market. It is more accurate and logical to compare bitcoin’s growth rate in relative to leading reserve currencies, safe-haven assets like gold, and government-issued fiat currencies.
Bitcoin was amongst the top 90 currencies in the world in early 2017. Within 11 months, bitcoin has evolved into the 30th largest currency in the global market with an exponential increase in user base, daily transaction volume, and trading volume.
As more institutional money moves into the bitcoin market and general consumers move on from the declining fiat currency system to a more sound and robust store of value, bitcoin will overtake fiat currencies to become the leading global currency.
“Bitcoin only has to grab a few % points of the global multi-hundred trillion investment market to realize a market cap of $1 trillion and beyond,” explained RT’s Max Keiser.
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