Bitcoin: A Significantly Investable Asset

Note: This article is courtesy of

Written by: Christopher Burniske, ARK Analyst

ARK Invest and Coinbase define investability  as providing ample liquidity and opportunity to invest. Globally, bitcoin exchange trading volumes are a good measure of the liquidity available to investors. As shown in the graph below, these volumes have been increasing steadily, reaching roughly $1 billion per day through the first quarter of 2016.


However, the graph above suffers a shortcoming as trading activity is self-reported by exchanges and not validated by third parties. If we were to look only at bitcoin traded as a cross with the US dollar, euro and British pound-the assumption being that businesses are monitored more closely when handling these currencies-the picture is starkly different.

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Daily trades made in these three currencies have been ranging between $10 to $100 million since early 2014, as shown in the graph below. For 2016, this comparison puts these three currencies at between 2-10% of global bitcoin trading volume.


As a percentage of reported bitcoin volume traded, the Chinese yuan took significant share during the explosive November 2013 price rally, and has continued to dominate (see graph below). Although over-the-counter (OTC) trading is still a small percentage of total volume generation, and not included in these graphs, itBit’s Asian OTC volume soared 300% month-over-month in March 2016.

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Virtual currency is not legal tender, is not backed by the government, and accounts and value balances are not subject to consumer protections. The information does not constitute investment advice or an offer to invest.