A study by CoinDesk has found that the USD is the dominant fiat currency in both the Bitcoin spot and Bitcoin derivative markets. The study included data from 26 to 30 July 2018, and found that 56% of Bitcoin spot trading was done with Bitcoin, and when including derivative markets, the share increased to 68%.

The study was conducted in response to studies by CryptoCompare and Coinhills, which concluded that the JPY was the dominant fiat currency in the Bitcoin markets. Apparently, these studies included Bitcoin derivatives trading denominated in JPY on BitFlyer without including USD-denominated Bitcoin derivatives on BitMEX, which is the largest Bitcoin derivatives market in the world. Nor did the studies include Bitcoin futures markets on CME and CBOE which can be considered derivatives.

The BitFlyer derivatives market accounted for 85-90% of JPY volume in the CryptoCompare and Coinhills studies, which makes the studies flawed if USD-denominated Bitcoin derivatives are not also included. Coindesk included all the major Bitcoin derivatives markets and found that the JPY was in second place behind the USD, with the JPY being used for 22% of the Bitcoin spot market and 29% of the total market which includes Bitcoin derivatives trading. The EUR and KRW accounted for 9% and 7% of the spot market respectively. For the total Bitcoin market, the EUR and KRW combined had a share of less than 1%, since most derivatives trading is done in USD or JPY.

The finding that the USD dominates in the Bitcoin market is perhaps not surprising, since the USD is the most powerful fiat currency in the world and dominates the traditional financial system.


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