Author name: @nobumei (https://twitter.com/nobu_mei)
<aside> đź’ˇ This section describes the market size and market growth rate of the blockchain market.
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01.1 Blockchain is a "Copy-prohibited technology”
In the previous section, I explained that blockchain is a copy-prohibited technology. In this section, we will look at how big this market is and how fast it is growing, based on quantitative data.
First, we will look at the market capitalization of the cryptocurrencies that triggered the spread of blockchain technology. The majority of DeFi and NFT services using blockchain technology issue cryptocurrencies associated to the protocol, so the market capitalization of cryptocurrencies can be approximated to the size of the blockchain market.
Market capitalization is calculated in the same way as for stocks, which is calculated by multiplying the value of the cryptocurrency issued by the project with the number of shares issued.
Market capitalization = number of units issued Ă— unit price In the case of BTC, the market capitalization will be [number of issued BTC: 21 million] x [current price].
There are various types of blockchains, such as Bitcoin and Etehreum, and by looking at the market capitalization of the blockchain you want to examine, you can visualize how much "value" is on that blockchain.
Since the birth of the first cryptocurrency, BTC, in 2009, the price of cryptocurrencies, led by BTC, has skyrocketed since around the end of 2020, and the entry of prominent investors and U.S. listed companies (MicroStrategy, Square, Tesla, PayPal) created a bull market that grew to a $2 trillion market and was close to $3 trillion at the peak.
Since the price of BTC at the beginning of 2018, when it was said to be a virtual currency bubble, was about $2 million, it has grown to about three times the price at that time, and the market capitalization of BTC by itself is about $1 trillion.
CoinGecko, 2021 Top 30 Stocks by Market Capitalization
When you hear that the entire cryptocurrency market is $2 trillion and BTC is $1 trillion, you may not get a sense of it because the orders are too large, so I will compare it to existing asset classes.
When considering BTC's market capitalization at $1 trillion, the closest market capitalization stock companies are Amazon and Tesla; of the Big Techs represented by the U.S. stock market, known as GAFA, BTC has already overtaken the market capitalization of Meta(former Facebook).
Those who say that BTC is a bubble, are they also saying that GAFA's market capitalization is also a bubble? We are now at the point where we should recognize that BTC's market capitalization is not an illusion, but a new asset with value.