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A recent NYDIG report found that Bitcoin had settled more transaction volume in Q1 2021 than âall credit card networks combined for the entire yearâ when including intra-network transactions.
New research has found that the annual transaction volume on the Bitcoin network surpassed that of some well-known card networks, such as American Express (AmEx) and Discover, during 2021.
The Saturday âNYDIG Research Weeklyâ report stated that Bitcoin processed $3 trillion worth of payments during 2021, placing it above popular credit card networks American Express ($1.3 trillion) and Discover ($0.5 trillion).
The report authors, NYDIG global head of research Greg Cipolaro and research analyst Ethan Kochav, also found that the Bitcoin network had settled more transaction volume in Q1 2021 than âall credit card networks combined for the entire year.â
âThis is astonishing growth, in our opinion, for a payment network that just had its 13th birthday,â they wrote. American Express issued its first card in 1958, and Discover in 1985.
However, the Bitcoin network still has a way to go before catching up to Visa and Mastercard, which processed $13.5 trillion and $7.7 trillion in transactions, respectively.
It also should be noted that the study only looked at the United States dollar value of transaction volume rather than the actual number of transactions. Therefore, itâs likely that most of the Bitcoin (BTC) transactions were simply users purchasing, swapping and selling their BTC rather than using it to pay for anything.
While Bitcoinâs growth in transaction volume has not always been linear year-to-year, Cipolaro and Kochav said that it has âkept up at a torrid pace when looking at 5-year compound annual growth rates.â
âAt the end of 2021, transaction volumes have been growing by nearly 100% annually over the past 5 years.â
In November 2021, a Blockdata report estimated that the Bitcoin network could potentially match the dollar value transferred on Mastercardâs network by as early as 2026. It also found that the Bitcoin network already processes more volume by dollar value than PayPal.
According to the report, the Bitcoin network processed about $489 billion per quarter in 2021, which is greater than PayPalâs $302 billion.
Related: Bitcoin overtakes PayPal on value transferred, sets sights on Mastercard: Report
The measure of Bitcoin transaction volumes doesnât report the raw volume of on-chain transactions but rather ârelies on statistical analysis by data providers (such as Glassnode) to remove transactions without economic substance.â
The report includes âintra-entity transactions,â which are transactions between addresses within the same wallet or owned by the same organization. For example, this might apply to a crypto exchange that is frequently moving Bitcoin around between different addresses. So, in other words, the $3-trillion figure should perhaps be taken with a pinch of salt.
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