Bitcoin is in a New Market Cycle and a “Much More Mature Position”: Circle Q2 Report


  • Bitcoin hash rate saw an uptick of 32% q/q while miners’ revenues register a change of 177% q/q
  • Tether dominance grew in Q2 despite being the center of controversy
  • Unlike previous cycles, this bull run has a slower cadence of institutional investors

Circle released its Q2 2019 report talking about the crypto industry growth and price of Bitcoin that rose to levels not seen since January 2018 along with the trading volumes across custodial, non-custodial exchanges and derivatives platforms.

When it comes to network activity, average daily active addresses surged for five consecutive months, up 26% quarter over quarter (q/q).

The average daily transaction had mixed monthly performance, up 187% year over year. Average daily value transacted and transaction size registered a consistent rise.

There has also been an uptick of 32% q/q in the hash rate of the Bitcoin network while miners' revenue saw a quarter over quarter increase of 177%.

Meanwhile, Litecoin Network capacity declined 11% q/q in BTC terms.

Tether Dominance Grew in Q2 Despite Being the Center of Controversy

When It comes to stablecoins, Tether’s dominance grew this quarter despite the revelation that USDT is only 74% backed by cash and equivalents followed by an investigation into Tether and Bitfinex by NYAG. Tether also dominates on-chain volume relative to all other stablecoins.

Among stablecoins, USDC showed the greatest growth (rise 48.7% q/q in market cap) followed by USDT (46.7% q/q) while GUSD’s market cap declined 75% q/q.

Bitcoin dormancy that sheds some light on the state of Bitcoin market cycles and its long term economic growth, has been on the rise with recent price action, up 103% q/q. But it’s still down 30% YTD and not yet at 2017 levels.

High dormancy means more long term holders are selling their BTC which is a bearish indicator while low dormancy is bullish as more coins are held for a longer period.

Unlike Previous Cycles, This Bull Run Has A Slower Cadence of Institutional Investors

The report says, Bitcoin performance in 1H 2019 suggests the “starting of a new market cycle” and in a

“much mature position.”

It also points out how high-quality assets have seen “differentiated” performance and they do not see the entrance of new low-quality assets that was “pervasive” in the last bull cycle.

This bull run, it notes, unlike the previous two cycles that were driven by retail investors, this time a “longer” cycle will see a

“slower cadence of Institutional investors.”

Institutionalization has been a recurring theme for years now but now we have started to see “greater involvement” from not only existing but also new institutional investors. The market is also seeing a maturation of institutional infrastructure such as regulated exchanges, custody providers, and investment vehicles and products,

“paving the way for incumbents enter.”

Notable mentions are Grayscale that showcases continued strength and derivatives volume that spiked in line with BTC price. Futures volume on BitMEX and CME combined were $342 billion while combined options volume on Debit and LedgerX was $2.6 billion in Q2.

Bitcoin (BTC) Live Price

1 BTC/USD =$35,705.2928 change ~ -4.22%

Coin Market Cap

$663.84 Billion

24 Hour Volume

$16.03 Billion

24 Hour VWAP

$36.86 K

24 Hour Change

$-1,506.59

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