CryptoQuant: over $1 trillion stored in the Bitcoin network
Bitcoin accumulates capital
As of today, more than $1 trillion has been accumulated in the Bitcoin network, factoring in both off-chain and on-chain activities. This figure represents an 85% increase compared to 2023, according to Ki Young Ju, founder of the analytics firm CryptoQuant.
He emphasized that Bitcoin serves as a store of value. Taking into account off-chain and on-chain activities, $1.03 trillion is currently stored in its network, marking an 85% growth over the past year.
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How this metric differs from market capitalization
Ki Young Ju points out that adding $1 to Bitcoin does not directly increase its market capitalization by $1. Therefore, a market cap of $2 trillion does not mean $2 trillion is stored in the network.
He suggests calculating this metric using several factors:
Exchange transactions (Off-chain): Exchange reserves are multiplied by the volume-weighted average price (VWAP) to estimate the capital entering the market via exchanges.
OTC trades and exchange deposits/withdrawals (On-chain): Bitcoin’s execution and settlement occur simultaneously. Capital inflows from over-the-counter (OTC) trades or on-chain exchange activities can be estimated using realized capitalization, which tracks the cost basis of actual movements.
By combining these data points, the SoV Index (Store of Value Index) is derived.
Previously, the CEO of CryptoQuant commented on Trump’s potential policy regarding Bitcoin.
