A Crypto Analyst Reckons Off-Chain Bitcoin Activity is in Bull Market Right Now
Zack Voell, a prominent crypto market researcher, has opined that while the pioneer cryptocurrency may be in a bear market in terms of price, there are signs to indicate that it is seeing bullish adoption with regard to off-chain activity.
Voell, who is an analyst at the Bitcoin mining software company Braiins, said in an opinion piece that growth trends and supply data show that Bitcoin adoption is increasing across layer 2 protocols, Bitcoin-backed tokens, and more.
Highlighting "built-on-Bitcoin" layer 2 protocols, he notes that the growth of the Lightning Network, Liquid Network, and RSK, has been trending upwards regardless of the price direction of Bitcoin in the past two years.
Similarly, tokenized Bitcoins - Bitcoin-backed tokens used as representations of Bitcoins on other blockchains - have been showing "extraordinary growth." An example of this is the Ethereum-based Wrapped Bitcoin (WBTC) launched by Bitgo.
The supply of WBTC has been growing over the past two years irrespective of the downward price action of Bitcoin. Meanwhile, since its launch, several other projects on Ethereum, Tron, Solana, and Avalanche blockchains have also launched other tokenized Bitcoin versions.
"The point of this data and analysis is simply to show that some people (in fact, a consistently growing number) see value in choosing to use their bitcoin somewhere besides the Bitcoin blockchain — and even places outside of the Bitcoin-native economy," he wrote.
The former Compass Mining senior mining analyst added that these use cases are just as valid as HODLing Bitcoin or using it on the native layer and could potentially be the future of Bitcoin adoption.
Voell's comments come on the back of choppy trading in the Bitcoin market.
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