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How Much Money Has Been Driven Towards Bitcoin?
Bitcoin is an innovative payment network and a new kind of money. Find out more about how it works and why so many people are investing in it.
The Bitcoin⚡️ Energy Standard
November 18, 2022
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When Bitcoin was released in 2009, it marked the beginning of the blockchain age and the digital currency revolution. Given how much attention Bitcoin has received, you may assume it to be commonplace by now. To what extent is it true? How much can one bitcoin be expected to be worth?Perhaps more crucially, what percentage of global currency is represented by bitcoins? With Bitcoin costing $54,752 as of November 26th, 2021, it's undeniably worth our effort to figure it out.
KEY TAKEAWAYS
As of November 26th, 2021, the value of one bitcoin was $54,572.
The total value of all bitcoins in circulation was around $1.03 trillion at that time.
Bitcoin amounted to just 2.9% of global currency at its peak value.
About 9% of the total value of gold in the world could be bought using Bitcoin.
As of 2018, around 7% of global currency was denominated in cryptocurrencies.
What Is the Value of Bitcoin?
Getting the grand sum of Bitcoin's worth is the simple part, so we'll do that first. On November 26, 2021, the total worth of all bitcoins was above $1.03 trillion, as reported by CoinMarketCap.
In contrast, Amazon (AMZN) founder Jeff Bezos was valued by Forbes at $205.7 billion.
As a result, Bitcoin's market valuation is now more than five times as large as Bezos' personal wealth.
When Bitcoin was finally recognized as legal money in El Salvador, it was June 9, 2021. To our knowledge, this is the first nation to take such a step. Any purchase from that store that accepts bitcoin is possible. In spite of some recent volatility, the U.S. dollar remains El Salvador's de facto currency.
Bitcoin and the Money Supply
We need to know how much money there is in total before we can estimate how much of the world's money is in bitcoins. This turns out to be more difficult than one might think. Banknotes, precious metals, money market accounts, and debt could all factor into such an estimate, among potentially hundreds of other forms of wealth. In May of 2020, the Money Project made an effort at this calculation, estimating worldwide narrow money at roughly $35 trillion.
At that rate, Bitcoin would only be worth around 2.9% of the value of narrow money, according to The Money Project's research.
The use of market capitalization to evaluate cryptocurrencies in general has drawn criticism. It's a quick and easy way to figure out how much something is worth all in all, but it's also prone to being skewed.
Bitcoin vs. Gold
When compared to gold, how does Bitcoin fare? It's true that gold is still held in high regard by some as the ultimate refuge asset. It's the benchmark by which all other currencies are judged. Initial estimates are from the World Gold Council. At the end of 2019, it was estimated that 197,576 metric tons of gold had been extracted.
Since annual mining output is typically approximately 2,500 t, the total amount of gold in the world on November 26, 2021, may be confidently estimated to be roughly 202 291 t. One tonne of gold is equal to 32,150.7 troy ounces, and the price of an ounce of gold as of November 26, 2021, is about $1,823.
Calculate the total worth of all gold as follows: 202,291 tonnes of gold x 32,150.7 troy ounces per tonne x $1,823 per ounce = $11.8 trillion.
All bitcoins were worth around 9 percent as much as gold.
Other Cryptocurrencies
If you want to know about the biggest and most well-known cryptocurrency in the world, it's Bitcoin. It is, however, hardly unique in this regard. The aggregate worth of all key cryptocurrencies, including Bitcoin, Litecoin, Monero, Ethereum, and others, is over $2.48 trillion. About 7 percent of the total narrow money value is represented there.
Conclusion
Over a decade ago, cryptocurrency appeared, but it soon gained a negative reputation because of its association with illegal activity, trading errors, hacks, and extreme price fluctuations. Interest in them has been growing, but only in recent years has it become widespread. Still, institutional investors are becoming more optimistic about Bitcoin and other cryptocurrencies as improvements in market infrastructure make trading in these markets easier to access.
FAQ
How much real money has been put into Bitcoin?
The total value of all bitcoins in circulation was above $1.03 trillion as of November 26th, 2021.
When did Bitcoin reach a $1 value?
Investing.com's price history shows that Bitcoin never went beyond $0.40 per bitcoin in 2010, but it did so in early 2011. Then, in February, it hit a $1 milestone.
Elon Musk has invested how much of his fortune into Bitcoin?
When news of Tesla's $1.5 billion Bitcoin investment broke in February 2021, demand for the cryptocurrency skyrocketed. The famously unstable cryptocurrency's price peaked at over $70,000 in November of 2017 before plummeting.
That's all for today, see ya tomorrow! If you want more, be sure to follow our Twitter (@croxroadnews)
DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.
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