According to Odaily, Ki Young Ju, the CEO of CryptoQuant, has stated that the circulation speed of Bitcoin is as slow as it was 13 years ago. Despite Bitcoin being envisioned as 'P2P electronic cash' by Satoshi Nakamoto, it is primarily being used as 'digital gold' today. Institutions are merely holding onto it without engaging in frequent transactions.
The circulation speed of Bitcoin will only reach its peak when it is widely used for payments. This observation suggests that Bitcoin's role has evolved over the years, from a potential everyday currency to a store of value akin to gold. The slow circulation speed indicates that Bitcoin is not being used as a medium of exchange as frequently as it was intended to be.
This shift in usage may be attributed to the increasing institutional adoption of Bitcoin. Institutions are more likely to hold onto Bitcoin as a hedge against inflation and economic uncertainty, rather than using it for daily transactions. This trend could potentially change if Bitcoin becomes more widely accepted as a form of payment in the future.