Today ECUREX, a digital finance marketplace for professional person traders as well as fiscal institutions headquartered inwards Zurich, is publishing a comprehensive 110-page study on digital currencies – an ECUREX Research Working Paper titled “Digital Currencies: Principles, Trends, Opportunities, as well as Risks.”
In June, Bitcoin Magazine reported that ECUREX was the starting fourth dimension digital currency telephone commutation platform to endure fully compliant with the Swiss Banking Act as well as Anti-Money Laundering (AML) Ordinance. Now, with the permission of ECUREX, Bitcoin Magazine is publishing some excerpts of the novel study earlier it’s publicly released.
The study is authored yesteryear Paolo Tasca, query economist at Deutsche Bundesbank as well as founder of ECUREX, with the back upward of ECUREX researchers James B. Glattfelder as well as Nicolas Perony, who also work, respectively, at the University of Zurich as well as Tamedia Digital. The document represents the author’s personal opinions as well as does non necessarily reverberate the views of the Deutsche Bundesbank or its staff.
“The study is rattling interdisciplinary as well as aims at talking to technologists who desire to know to a greater extent than nigh economical as well as legal aspects of digital currencies or economists as well as lawyers who desire to know to a greater extent than nigh technical aspects,” Tasca told Bitcoin Magazine. “We intend that the study should come inwards non exclusively on the desks of executives, exactly instead it should come inwards to the desks of everyone interested inwards the topic. Thus nosotros decided to position it online available to endure downloaded yesteryear everyone for free. …[I]t volition endure online on the ECUREX website.”
The study describes the ongoing innovations inwards the fiscal sector brought nigh yesteryear digital currencies from a multi-level perspective: systemic, technical, legal as well as industrial. The document extensively covers the electrical current trends inwards the domain inwards social club to give the reader a quantitative agreement of the potential opportunities as well as risks arising from the global adoption of digital currencies. The ECUREX report, which is the outcome of to a greater extent than than 2 years of function involving the collection as well as analysis of information from to a greater extent than than xxx dissimilar sources, is the starting fourth dimension comprehensive study on digital currencies that provides a joint, deep quantitative analysis of their technological, entrepreneurial, economical as well as legal aspects.
“Our destination is to attain the broader possible audience of students as well as practitioners,” said Tasca. “We promise that the digital currency marketplace study volition move their direct as well as roadmap that volition help them to navigate the complex as well as evolving Bitcoin ecosystem. The thought of producing a digital currencies marketplace study started already when I was working equally Research Officer at the London School of Economics (around Nov 2013) earlier joining the Deutsche Bundesbank.
“At that fourth dimension I was notwithstanding generally working on systemic run a jeopardy inwards fiscal markets, exactly I perceived as well as understood the revolution that digital currencies as well as blockchain technologies would convey brought to our socio-economic systems,” he said. “Thus, I felt the importance as well as the require to promote the cognition of digital currencies as well as P2P fiscal systems (more inwards general) to the broader audience of students, academics as well as practitioners equally much equally possible.“
“After 2 years of work, straightaway I am fifty-fifty to a greater extent than convinced that blockchain technologies volition modify forever the style nosotros make concern (not exclusively inwards finance).”
Section 1.3 of the paper, “Key Findings,” is reproduced below with the permission of ECUREX.
The most of import primal findings are summarised here. For the original query as well as details on the information sources, encounter the corresponding sections inwards the master copy text.
The average amount transferred per Bitcoin transaction is larger than inwards whatever other major payment network. During the catamenia 2011–2015, the average amount (in USD equivalent) per transaction constantly increased, as well as remained larger than inwards the major payment networks such equally Visa, Mastercard, Discover, or Western Union. Although the Bitcoin payment network is getting closer inwards total transaction book to these large networks, its daily transaction book of ca. USD 50 ane K m (about ane quarter of Western Union’s) is notwithstanding the lowest one.
The relative capitalisation of Bitcoin with regard to other digital currencies is receding inwards favour of Ripple’s. Until mid-2014, Bitcoin dominated the digital currency marketplace yesteryear roofing upward to 95% of its total volume. Since then, its dominant seat has been eroded yesteryear Ripple, which straightaway covers nigh 10% of the total marketplace capitalisation. On average, the relative currency forcefulness of Bitcoin has decreased compared to that of the other (almost) existing 500 digital currencies, fifty-fifty though Bitcoin remains dominant on the digital currency market.
China is the largest province inwards the basis per: (1) issue of active Bitcoin clients; (2) mining capacity (since the terminate of 2014, Chinese mining pools embrace 50% of the total marketplace share); (3) book of Bitcoins exchanged via electronic trading platforms (since 2014, the traded CNY/BTC book inwards is nigh 3 times larger than the USD/BTC volume, with peaks at BTC iv ane K m per week).
Bitcoin startups raised almost USD 1 billion inwards iii years with an annual investment growth charge per unit of measurement of nigh 150%. Capital investments inwards Bitcoin-related startups is a recent tendency that started inwards the starting fourth dimension quarter of 2012. Since then, the Bitcoin manufacture raised almost USD 1 billion as well as it represents the fastest growing sector for working capital alphabetic character investment. Within the Bitcoin sector, the Mining as well as Payment & Remittance industries drove the funding race. Coinbase lone covered ane 3rd of the working capital alphabetic character raised yesteryear the whole Payment & Remittance industry, as well as 21 Inc over one-half of the working capital alphabetic character raised yesteryear the Mining industry.
In Jan 2015 the Bitcoin book exchanged on electronic trading platforms reached 50% of the total issue of Bitcoins always mined at that time. At 2 points inwards mid-2014 as well as Jan 2015 the book of Bitcoins exchanged via electronic trading platforms reached a historical high equivalent to over one-half of the issue of Bitcoins that had been mined at that time. Since then, the book of Bitcoins traded on electronic exchanges has remained stable at a higher value than the book of transactions betwixt users, recorded inwards Blue Planet Bitcoin blockchain.
During the yr 2014, the transaction costs inwards digital currencies dropped significantly. Throughout 2014, the average fee per Bitcoin (Litecoin) transaction decreased from nigh USD xx (7) cents to USD 10 (1) cents.
The yr 2014 saw fewer incidences as well as less arbitrage opportunities than the previous years. In effect, the digital currency marketplace is becoming to a greater extent than efficient. Since 2011, Bitcoin’s volatility has been constantly decreasing. In addition, the likelihood as well as intensity of arbitrage opportunities dramatically dropped to less than 1%, signalling that the digital currency telephone commutation markets are becoming to a greater extent than efficient.
The wealth distribution inwards the Bitcoin ecosystem is highly unequal, as well as this inequality is growing. The inequality of the distribution of Bitcoins with addresses, summarized yesteryear the Gini coefficient (higher is to a greater extent than unequal), grew from 0.09 inwards 2010 to 0.99 inwards 2015: from quasi-perfect equality to quasi-perfect inequality. However, this is non a “rich larn richer” phenomenon. During the catamenia 2009–2015, the move yesteryear 100 richest addresses kept a constant relative wealth, totalling nigh 20% of the total value of the Bitcoin economy. The increment inwards the inequality is the outcome of: (1) a socio-economic phenomenon, due to the growing popularity of Bitcoin, as well as (2) wallet fragmentation due to safety practices such equally single-use addresses as well as novel addresses generated for modify transactions.
The Mining manufacture is consolidating equally an oligopoly. The Bitcoin mining marketplace is currently nether command yesteryear five to vii major mining pools. During the catamenia 2013-2015, the cumulative marketplace portion of the largest 10 pools relative to the total marketplace hovered inwards the 70%–80% range.