Bitcoin [BTC], the most dominant cryptocurrency in the market, and the US dollar, together, is the most popular crypto-fiat pair in the market. The turn of the year saw the Dollar step-up its fight against the Japanese yen [JPY], following the latter’s December 2018 dominance.
CryptoCompare, the virtual currency analysis firm, released its exchange review for March 2019 which looked at the trading volume of Bitcoin to Fiat. Studying the exchange volumes in seven prominent crypto-fiat trading pairs for the first quarter of the year, some telling signs were observed.
Although USD holds over 46 percent of all BTC trading into fiat for February and March, all signs are not positive. The BTC to USD volume was in continuous decline, dropping from over 1.4 million BTC in January to under 1.24 million BTC in February. Further, March saw a significant 26.2 percent decline to 0.92 million BTC.
The Japanese Yen, trailing the USD as the most dominant fiat currency in the market, held less than one-fourth of the total Bitcoin-to-fiat volume in the month of March, despite the growing cryptocurrency market in the country. From January to February, the JPY held its share of the market, which was soon wiped clean in the following month.
Absolute volume of the yen saw a drop from 0.9 million BTC to 0.48 million BTC in March. Given the yen’s decline, the Korean won [KRW] rose by 41 percent in March, cruising to 0.21 million BTC from a February low of 0.15 million.
Other dominant fiat currencies in the list were the Euro [EUR], the Polish Złoty [PLN], the British Pound [GBP], and the Russian Ruble [RUB]. However, CryptoCompare clarified that 95 percent of the total trading from BTC to fiat were made in four sovereign currencies, namely, the USD, JPY, EUR, and the KRW.
The US Dollar’s overtake of the Japanese yen in 2019 is an indication of the larger community’s fiat trading preference change and the performance of the respective fiat currencies. In December 2018, Coinhills reported that the JPY surged ahead of the US Dollar in the Bitcoin to fiat market.
Based on the aforementioned analysis, the JPY took 48.34 percent of the market while the US dollar took 43.77 percent. Corresponding to the current fiat preference, the Euro and the Korean won took the third and fourth spots, respectively.
A slew of regulatory changes by Japan’s Financial Services Agency [FSA,] coupled with the reinforcement of security measures by the country’s exchanges, saw their native currency rise in the BTC-fiat chart, albeit briefly, in December 2018. The country’s concern towards the digital assets industry, coupled with the USD slump towards the close of the year, resulted in the JPY taking the top spot.
However, since the re-opening of the US government, the Dollar has seen two cycles of upward movements. The initial few days of February and March saw the US Dollar rising, which allowed it to overtake the Japanese yen and take back its spot on the BTC-fiat ladder.
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Graduate of Finance and Economics, interested in the intersection of the world of decentralized currency and global governance.