Weiss Ratings Leverages Bitcoin Fundamentals Data to Show Adoption is Growing Worldwide
In a recent report released by Weiss Cryptocurrency Ratings, Bitcoin’s adoption is stronger than ever. In the report, Bruce Ng explains that when they gave Bitcoin a C+ rating, crypto enthusiasts were angry about it, even when they’ve explained why they’ve decided to take such a decision.
Bitcoin’s hash rate continues to grow. Compared to just a year ago, the computing power that is used to secure the network has more than doubled. According to blockchain.com, Bitcoin’s hash rate is currently 38 million TH/s. Earlier in 2018, it was close to 17 million TH/s.
The hash rate is very important to avoid 51% attacks. As the hash rate grows, it becomes increasingly difficult to perform a 51% attack such as the one experienced by Ethereum Classic (ETC) a few weeks ago.
The second thing that Weiss Ratings mentions is that the number of daily active addresses remains stable, even after a year-long bear market. As Bitinfocharts shows, since April 2018, there are 500,000 daily active addresses in the network. Although the number of addresses keeps growing, the active users remain stable. In a bear market, this shows that individuals are not leaving the space.
Transaction volume has also been growing. Back in December 2017, when Bitcoin was reaching its all-time high, the number of confirmed transactions per day grew up to 495,000. Then, in April, it went down to 135,000 transactions per day. Now, we are close to 275,000 transactions per day.
This is also very positive, because the bear trend in Bitcoin’s price continued during the whole year, but the number of transactions continues to grow.
Average transaction fees are also falling. In December 2017, Bitcoin transaction fees were very high. In some cases, each transaction could cost $55 to be sent. However, they’ve fallen from their peak. Currently, the fees paid to miners that confirm transactions are $76,000 per day.
The report released by Weiss Ratings reads as follows:
“At the peak in 2017, Bitcoin transaction fees were often higher than the transaction was worth, to begin with. […] Currently, the total fees paid to miners on the network is around $76,000 per day. Since that's for approximately 300,000 different transactions, the average fee is only about 25 cents per transaction.”
The reduction of these fees is related to the increasing adoption of Segregated Witness (SegWit), an implementation that reduces the size of the Bitcoin transactions. This allows the network to process more transactions in each of the blocks.
Finally, the last point that Weiss Ratings mentioned in its report is the growth of the Lightning Network (LN). The LN a second layer scaling solution for Bitcoin that would allow the network to process several hundreds of thousands of transactions per second without congesting the main network.
Back in January 2018,there were close to zero operative nodes in the Lightning Network. Now, there are more than 5,000. According to 1ml.com, the exact number of nodes is 5,666 and there are 22,005 channels as well. The network capacity is currently 570.97 BTC, close to $2.08 million.
According to Weiss Ratings, Bitcoin’s C+ rating could be changed for a better one if the market starts improving.
At the time of writing, each BTC can be purchased for $3,650. The market capitalization of Bitcoin is $64 billion.