The Place of Cryptocurrencies in the System of the Entire World’s Wealth

The digital currency market has been bearish for 8 months already, representing a downward trend in general. Many respected entrepreneurs, such as Jamie Dimon, JPMorgan CEO, think that this trend will continue. However, Bitcoin and altcoins have already become an important part of the global economy.

Reading the Graph 

   

If we look at the right side of the graph, it is easy to notice that bitcoin’s market cap is currently bigger than the personal funds of Bill Gates and nearly equals the fortune of Jeff Bezos. Moreover, the total value of all virtual coins in the world is at the astonishing level of $202 billion. That is even twice more than the capitalization of Goldman Sachs. 

Let’s pay attention to other numbers now. First of all, it is crucial for any investor or trader to understand the scale of fintech’s development. For example, the first trillion-dollar company, Apple, is worth $888B more than bitcoin ($1T vs. $112B). Cryptocurrencies are even tinier compared to the world’s stock markets at just 0.30% ($67.5T vs. $202B). Cryptocurrencies are the equivalent of only 0.23% of all the money in the world, broadly defined ($86.5T vs. $202B). Given all these comparisons, it is clear that cryptos are only at the beginning of its route and there is a lot of unpredictable twists ahead. 

Bitcoin’s Position 

The overall market cap of Bitcoin has more than doubled from $41B to $112B over the past year. Moreover, the mass media paid a lot of attention to the manipulation of the crypto market and hacks of exchanges. However, the recession is not a new phenomenon in the crypto world. In short, the value of cryptocurrency increases and shrinks, but during the last year and a half, bitcoin has shown a significant net profit in value. 

It is hard to imagine all the money of the world in fiat state, furthermore, used for any kind of exchange. Not including $34.4T of physical money, there still are $67.5T in stock markets and $86.5T in bank accounts. That means if each person wanted to exchange their money on fiat, states would have to print all these money additionally to those currently in circulation.