Critics of Bitcoin Network and decentralized networks constantly lambast this nascent asset class for having no inherent value, or a chance for adoption. But according to statistics relayed by a crypto-asset analyst, this cannot be further from the truth.

Bitcoin’s Base Layer Transacts $1.3 Trillion Annually

Yassine Elmandrja, a crypto-asset analyst from the fintech-focused Ark Invest, recently revealed a surprising set of statistics that may hamper the spirits of cryptocurrency critics and pessimists alike.

According to the New York-based analyst, Bitcoin’s raw transaction count pales in comparison to technologically-advanced centralized networks, like Paypal, Mastercard, and Visa.

Bitcoin’s base layer transaction volume doesn’t compare to Visa’s, MC’s et al. But it was never supposed to. pic.twitter.com/jiPpxR4SOQ — Yassine Elmandjra (@yassineARK) August 22, 2018

To be more specific, there were 104 million on-chain Bitcoin transactions in 2017, while Visa processed over 1,000 times that amount at well over 100 billion transactions, as per data compiled by Elmandjra and Ark Invest.

Although this statistic may seem bearish in and of itself, as it alludes to the fact that Bitcoin is experiencing scaling qualms, Elmandjra later added that the ethos of the Bitcoin’s base layer was “never supposed to” compete with the number of transactions processed by centralized systems.

Look 👀 at the transaction *value*, NOT the transaction *volume*. $3-4 B worth of bitcoin has been transacted daily in the last year. At ~ $1.3T annually, Bitcoin’s base layer transactional value is within an order of magnitude away from Visa’s. pic.twitter.com/KhGva4I1rB — Yassine Elmandjra (@yassineARK) August 22, 2018

And while Paypal processed over seven billion transactions in 2017, compared to Bitcoin’s 104 million, the collective value of all Bitcoin transactions reached over $1 trillion, while Paypal’s transactional value only amounted to a relatively measly $500-$600 billion. Keeping this figure in mind, Elmandrja noted that “Bitcoin’s base layer transactional value is (only) within an order of magnitude away from Visa’s.”

But even as optimistic as this news is, the Ark Invest analyst quickly drew flak from pessimists, who claimed that “99%” of the $1 trillion figure cited in the statistic was tied to speculative trading, rather than real-world adoption via the payment of goods and services. Other naysayers pointed out that this isn’t an “apples to apples comparison,” as some see Bitcoin more as a store of value for large sums of capital, rather than an active transactional tool for day-to-day use. Nonetheless, this astonishing figure goes to show that Bitcoin has begun to garner some semblance of adoption and use.

So watch out legacy networks, the Bitcoin Network may be right on your tail very shortly.

The “Network Effect” & Bitcoin

As the crypto market established new all-time highs in late-2017 and early-2018, everyone and their dog began to pile into this industry, making their maiden crypto transactions as prices were on a crusade to move upwards.

Although 2018’s bear market may have deterred a few newcomers, the number of individuals actively utilizing cryptocurrency-related products, services or program has undoubtedly increased drastically since 2017. This alludes to the so-called “network effect” that has become an integral part of the crypto community’s vernacular.

For those who are unaware, a network effect is an uptick seen in the value of a system, good or service as the number of active participants increases in said network. As alluded to previously, Bitcoin exploding in value last year was evidently a premier example of a network effect. And the fact that the Bitcoin Network has processed more value than Paypal just brings credence to the idea of the network effect, and that Bitcoin is growing at a fantastic rate, even while prices may say otherwise.