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Market Sizing

Total Addressable Market

Total Bitcoin in circulation: 18.8 million BTC (Approx $564 billion USD at $30,000 per BTC)

Estimated lost to time, including Satoshi's 5%: 25% or around 4.7 million BTC (Approx $141 billion USD)

Remaining in circulation: 14.1 million BTC (Approx $423 billion USD)

Trends

Institutions driving 85% of recent buying according to Matrixport (Jan 2023)

Circulating supply of Bitcoin is around 25%, showing propensity to use in DeFi

Bitcoin mining hashrate just hit an ATH, suggesting active investment

Bitcoin is often used by hedge funds as collateral for margin trading, and BTC has more trading pairs than any other crypto today

Analogues

WBTC: Current market cap is $4.2 billion USD

As of today, 163,000 WBTC are deposited in Aave, about 10% of its total circulating supply

This enables lending on approx $2.1 billion USD (assuming 50% LTV ratio)

tBTC: Current TVL $32.6Mn

Approximately 1250 tBTC, up from 104 in January 2023

This implies CAGR: ~780%

Potential for DLCs

DLCs (Discreet Log Contracts): The data suggests strong institutional and retail demand for Bitcoin. There’s high potential for a trustless collateralization mechanism to attract a significant portion of the 14.1 million BTC in active circulation.

If 14.1 million BTC are used in DLCs, that would amount to approximately $423 billion USD in value. At a 0.2% fee rate, the potential revenue could be around $846 million USD/yr.

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