18 Sep 2023 Jane Whitmoore
Bitcoin Eclipses VISA In Transaction Volumes
The most popular cryptocurrency in the world, Bitcoin, made history by outpacing Visa in terms of annual transaction volume. This achievement demonstrates the expanding importance of decentralized networks, but it has nuances that need to be properly taken into account. Despite the fact that this development is unquestionably noteworthy, it is crucial to look at the specifics of Bitcoin's transaction volume as well as its wider financial landscape implications.
The cryptocurrency market is anticipating Bitcoin (BTC) to navigate a challenging technical environment. The price of Bitcoin was trading above the 9-day and 20-day Exponential Moving Average (EMA) lines at the time of publication, indicating the possibility for a sizable increase.
However, just as in any market, every story has two sides. If Bitcoin is unable to maintain its position above the 9-day EMA line, which is currently situated close to $26,356.84, it may be in danger. The next 24 to 48 hours are expected to be crucial because of the recent activation of a sizable bullish technical flag.
Understanding transaction volume
At first glance, it appears like the cryptocurrency community is happy that Bitcoin has exceeded Visa in terms of transaction volume. However, we must consider what this measurement signifies in reality. Transaction volume in the context of Bitcoin can be misleading. The network's activities during the past year have been heavily influenced by Ordinals.
This protocol enables transactions with extra data, including photos, by allowing satoshis (Bitcoin's smallest unit) to be given unique IDs on the blockchain. Although they do contribute to the volume, these high-frequency transactions are not always a sign of significant retail use or adoption.
When contrasting Bitcoin with established payment methods like Visa, one must proceed with caution. Notably, whereas Bitcoin runs on a decentralized blockchain, Visa is a centralized payment network that has been optimized over decades for consumer transactions. Their use cases, restrictions, and transaction types all reflect this structural difference at its core.
The majority of Visa transactions involve regular consumer purchases, such as groceries and online shopping. The activities that can be represented by a Bitcoin transaction, on the other hand, can span a wide range, from buying a cup of coffee to transferring multimillion-dollar assets. Although impressive, Bitcoin's adaptability makes it difficult to compare it directly to a centralized payment system created for user convenience.
Despite these challenges, it is definitely a historic event that Bitcoin has surpassed Visa's transaction volume. It highlights the increasing importance of decentralized networks in the world of finance and poses intriguing queries regarding the direction of the financial system in the future.
Could cryptocurrency and other decentralized networks ever replace centralized systems as the standard? While supporters of financial inclusion and Bitcoin aficionados are excited about this possibility, the road to widespread adoption of decentralized payments comes with its challenges.
El Salvador's experiment with accepting Bitcoin as legal cash has brought to light a number of flaws and problems that the general public may encounter while using digital payments. The implementation in the nation was hampered by technological issues, regulatory worries, and public distrust. This example shows that while decentralized networks have promise, they still need to get through infrastructure, education, and acceptance issues.
Bitcoin had a week of ups and downs, climbing to new highs in September before circling back to approximately $26,500 by the end of the week. This price fluctuation demonstrated the cryptocurrency's adaptability to shifting market circumstances.
Source: CoinStats
Bitcoin reached a high of $26,880 at its top earlier in the week, which was also its highest point in September.
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