Cryptocurrency exchanges are playing a massive role in the flow of capital across blockchain networks.

According to a tweet by Willy Woo, a data-driven cryptocurrency analyst, 35% of all on-chain transactions involve cryptocurrency exchanges, meaning that one out of every three Bitcoin transactions involves an exchange.

~35% of on-chain outputs is traffic to and from exchanges. Common view: Bitcoin’s purely for speculation. Alternative view: it’s flows of capital funding its way into and out of a new class of Store of Value. [paraphrasing @nic__carter/@coinmetrics work] pic.twitter.com/nRp82flmAj — Willy Woo (@woonomic) September 26, 2018

In analyzing the data, Willy Woo hypothesizes two potential reasons for the transaction patterns: that Bitcoin is purely a speculation vehicle and continues to dominate simply in a trading capacity or that these transactions represent the flow of capital into the digital asset class. The latter infers that Bitcoin is beginning to act more like a store of value.

While much of the activity on Bitcoin’s network is likely due to trading activity, the relative stability of its price over the last months indicates that it has become a fairly stable store of value. In fact, Bitcoin has recently been in its lowest period of volatility in nearly 16 months.

Regardless, the high transaction volumes from cryptocurrency exchanges will likely not die down anytime soon as a recent report by ICO advisory firm Satis Group projects that the global cryptocurrency trading volume will grow by 50% in 2019 and will continue to grow at a 9% CAGR through 2028.

Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.