The Head of DWF Labs Andrew Grachev Believes Bitcoin Is Evolving Into a TradFi Asset With Rising Value and Declining On‑Chain Activity

Bitcoin, commonly known as the “king of cryptocurrencies,” has shown big changes in its market direction, especially as it is beginning to play a role in decentralized finance (DeFi). In Andrew Grachev’s view, Bitcoin is still mainly a cryptocurrency, yet it is developing in a direction that takes it closer to TradFi. Similar to others in the industry, Grachev points out that Bitcoin was born as a decentralized system. However, today it is widely used in the world’s investment markets with traditional assets like stocks and bonds.

Grachev claims that even though Bitcoin is still a cryptocurrency, its use by large corporations and connection with regular finance puts it right alongside other traditional financial assets. Bitcoin is gaining popularity now as people use it to set aside money and protect themselves against inflation, just as people use gold. With increasing acceptance of Bitcoin as a digital asset, people are now using it mainly for its value-holding power, which may strongly shape the way its market reacts.

Rising Bitcoin Value and the Declining On-Chain Activity

Grachev points out that he sees Bitcoin’s value rising in the years to come. This is because Bitcoin has a bigger role in modern finance, and more institutional investors are seeking it. Economic situations, including inflation, conflicts around the globe, and the introduction of blockchain in financial institutions by banks, play an important role in determining Bitcoin’s value. The higher Bitcoin is regarded as a haven for risky times, the more its price might rise.

Still, Grachev believes that as prices go up, the number of Bitcoin transactions will probably be lower. When Bitcoin’s value rises, the number of transactions being handled by Bitcoin’s network will still decrease in the future. The facts shared in the data that accompanied Grachev’s tweet help support his observation in the Bitcoin network. According to The Block graph, the number of Bitcoin transactions each day has gone down, from more than 700,000 at its highest to approximately 400,000 today.

Even more people are choosing Bitcoin to invest in, not to make everyday purchases. As it becomes more important in world finance, Bitcoin is now used less as a currency for transactions. Nowadays, most Bitcoin users are concerned with saving and making money, instead of using their Bitcoin for daily transactions.

The Future of Bitcoin: A Digital Asset for the Traditional Financial Ecosystem

Since Bitcoin is moving from being a cryptocurrency to a regular financial asset, it will be assimilated into current financial structures even more. Grachev’s views on Bitcoin demonstrate the increased number of institutions taking an interest in it over the past few years. Bitcoin is now being treated as a standard investment by firms, hedge funds, and even big companies. As a result of these changes, Bitcoin might have stricter rules set, which will enable it to be accepted into the traditional financial system.

Grachev’s report reflects today’s situation, but it also predicts what will happen to Bitcoin in future years. Because Bitcoin is becoming more present in the financial sector, regulations are likely to play a bigger role, and big investors are expected to take an interest. Grachev believes that Bitcoin will have a bright future if it keeps merging with TradFi while staying true to its basic principles of no central authority and having a limited supply.

Bitcoin’s Dual Nature as a TradFi Asset and a Store of Value

All in all, Andrew Grachev’s ideas about Bitcoin offer useful thoughts on the progress of the cryptocurrency. More and more, Bitcoin is being regarded as an asset in the conventional finance sector. Bitcoin’s worth has gone up, while how frequently it’s exchanged on-chain has dropped, which indicates its changing status to being a digital asset, as gold is. As people and organizations use Bitcoin more for its investment opportunities, its chances of success in finance are better than ever before. Since there are fewer transactions on the blockchain, it looks like Bitcoin will be used less for daily purchases as more people treat it as a form of investment.