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Crypto-Based Commerce Spikes 65% in 7 Months

Commerce fueled by cryptocurrencies has once again started to grow. Data collected by blockchain forensics company Chainalysis shows a significant increase of volume in the first half of the year. The positive change coincided with the remarkable market recovery that followed last year’s prolonged crypto winter.

Also read: Turkey Becomes the Latest Nation to Work on Digital Fiat

$5.5 Million of Crypto Used in Commerce Daily

After a string of depressing months in 2018, cryptocurrency-based commerce began to rise again in 2019, the study quoted by Bloomberg indicates. According to New York-headquartered Chainalysis, the amount of cryptocurrency sent to 16 merchant service providers such as Bitpay increased by 65% between January and July. During the same period, the price of bitcoin core (BTC) tripled to over $12,000.

Crypto-Based Commerce Spikes 65% in 7 Months

This year’s positive trend contrasts with the findings from last year, when Chainalysis registered a decline in bitcoin-related trade. The company’s 2019 research covers not only commerce based on BTC but also payments in bitcoin cash (BCH), litecoin (LTC) and the stablecoin tether (USDT). These cryptocurrencies, the report notes, are used to fund everything from online gambling to purchases at pot shops.

According to Kim Grauer, senior economist at Chainalysis, the increase in bitcoin-denominated trade suggests that there is more trust in crypto now. The overall amount of cryptocurrency used in commerce remains small, the publication acknowledges, but yet it grew from around $3 million daily in January to $5.5 million per day on average in July.

The volume is likely to expand further as platforms like Bitpay, which allows merchants to accept payments in BCH and BTC, introduce support for more digital coins in the future. The company, which processes over $1 billion in transactions annually, expects continued growth as new currencies are added including ether (ETH) and ripple (XRP), spokesperson Jan Jahosky told Bloomberg.

Slow Transactions Are a Major Hurdle to Adoption

Various cryptocurrencies differ in many ways and the authors point out that inconvenience related to certain specifics has been a major barrier to the growth of crypto payments. For example, transaction confirmation on the BTC network can take up to an hour, making it hard for people to just walk in a store, buy a cup of coffee and leave, the article notes.

Crypto-Based Commerce Spikes 65% in 7 Months

The characteristic volatility of most digital assets is also a negative factor and many businesses and consumers are still reluctant to deal in crypto for that reason. At the same time, the researchers have found a five-fold increase in the use of tether during the examined period. According to Chainalysis, the stablecoin whose price is pegged to the U.S. dollar accounted for 9% of all commerce during the seven months covered in the study.

In reality, a growing number of merchants accept direct cryptocurrency payments. For instance, the Bitcoin Cash Map application now lists 1,769 locations of brick and mortar stores that let you pay with BCH. And according to a recent report by marketing analysis company Semrush, quoted by La Stampa daily, cryptocurrency is the third-most popular online payment method in Italy. Bitcoin is behind only Paypal and Postepay, while it is more widespread in Italian ecommerce than direct payments with any of the major credit cards.

What do you consider to be the main obstacle for faster growth of crypto payments? Share your opinion on the subject in the comments section below.

Images courtesy of Shutterstock.

Are you a developer looking to build on Bitcoin Cash? Head over to our Bitcoin Developer page where you can get Bitcoin Cash developer guides and start using the Bitbox, SLP, and Badger Wallet SDKs.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Bulgaria, which sometimes finds itself at the forefront of advances it cannot easily afford. Quoting Hitchens, he says: ”Being a writer is what I am, rather than what I do.“ International politics and economics are two other sources of inspiration.

Lubomir Tassev , 2019-11-09 01:00:52 ,

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NewsBlock © 2019 - 2020 All rights reserved.

NewsBlock © 2019 - 2020. All rights reserved.

While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

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Nick Chong , 2019-11-10 12:00:38

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