Bitcoin (available on Coinbase) is closing out the month near $8,500 USD. Surging more than 60% since the beginning of the month, its revival has caused a global stir. However, in the midst of the excitement, blockchain researcher Chainalysis is discovering a problem that perhaps most of us already know: hardly anyone is actually spending it.

Chainalysis Inc Chimes In

Data from New York-based Chainalysis is showing that “only 1.3% of economic transactions came from the first four months of 2019, little changed over the boom and bust cycles of the prior two years.”

Further, that “hardly anyone is using the world’s largest cryptocurrency for anything beyond speculation.”

Services that allow customers to pay for goods and services with Bitcoin (available on Coinbase) are out there, but very few merchants actually want to use them. The reason remains the same as before—price volatility. A digital asset’s price may surge another 50% in a matter of weeks, and no one is ever sure of its true “value” because of this.

This is a double-edged problem that Bitcoin (available on Coinbase) has always faced. It needs to gain mass appeal and so needs the hype; however, in doing so, it has “developed a culture of “hodlers” who advocate accumulation rather than spending.”

Yes, there are millions of dollars worth of Bitcoin (available on Coinbase) out there, but it’s staying put on exchanges it seems.

Chainalysis Analysts

Kim Grauer, a senior economist at Chainalysis, said the following to Bloomberg:

“Bitcoin (available on Coinbase) economic activity continues to be dominated by exchange trading […] This suggests Bitcoin (available on Coinbase)’s top use case remains speculative, and the mainstream use of Bitcoin (available on Coinbase) for everyday purchases is not yet a reality.”