The data recorded on blockchains often gives the impression of offering a precise reading of financial flows. However, a study by the Bank for International Settlements (BIS) shows that certain metrics can vary depending on the method used. For bitcoin, researchers noted a gap of up to six times in the estimation of the value of transfers made on the blockchain. This difference does not concern the exchanges carried out on the platforms, but rather the interpretation of transactions recorded directly on the network.
In brief
- The BIS reveals that estimates of onchain transfers can vary up to six times depending on the method used.
- Changes in transactions complicate the interpretation of flows actually sent to third parties.
- Conventional market capitalization can reach four times the realized capitalization.
- The study calls for considering onchain metrics as approximations rather than direct measurements.
Transfers difficult to measure precisely
The BIS study first highlights the limits linked to the structure of bitcoin transactions. When a user spends funds, the unused portion can return to their own address in the form of currency. This output may then appear as a transfer, even though it does not correspond to a payment intended for a third party. The calculated value therefore depends on the processing of these movements.
According to theresearchers’ analysisthese methodological choices can cause considerable differences between different estimates. In some cases, the value of bitcoin transfers on the blockchain varies up to six times depending on the method chosen. This difference concerns on-chain flows. The raw data remains the same, but its interpretation changes according to the rules.
The BIS also emphasizes here that several indicators sometimes give an impression of greater precision than that allowed by the data. Transaction volumes, market capitalization and total value blocked therefore present limits of interpretation. Researchers consider on-chain metrics to be approximations. This distinction matters when analyzing the real uses of a network.
Capitalization also has a difference
The problem is not just with bitcoin transfers. The study also notes a gap between conventional market capitalization and realized capitalization. The latter values each unit according to its last transaction price, while the conventional measurement is based on another approach. Conventional capitalization has sometimes reached four times the realized capitalization.
These results come from an analysis of 100 billion blockchain records from Bitcoin, Ethereum and Tron. The sample shows that these difficulties concern more widely the data produced by the different networks studied. Consequently, the comparison between indicators requires taking into account their construction method.
Ethereum adds a difficulty with the proliferation of smart contracts. Of approximately 67.5 million active contracts examined, nearly 54 million could not be categorized according to the criteria used by the study. This situation complicates the interpretation of blockchain activity. Researchers thus observe similar challenges for Bitcoin in several segments of the crypto ecosystem.
Stablecoins illustrate the limits of raw data
The analysis of USDT shows why the same data can hide different economic uses. On Ethereum, USDT appears more linked to decentralized finance, while that present on Tron is more associated with payments and store of value. The assets held in smart contracts reinforce this difference. On Ethereum, their share exceeded 20% in 2022, compared to around 1% on Tron.
For researchers, aggregating Bitcoin and USDT activity across multiple blockchains can mask these differences in usage. The same global metric can bring together operations linked to DeFi, payments or the conservation of value. The study invites us to look at the context of each transaction. This approach better distinguishes technical activity from economic activity.
Some tools already apply this separation. Visa, with its Onchain Analytics dashboard powered by Allium Labs, presents stablecoin transaction volumes in two forms. Adjusted volume reduces certain distortions, including bots, high-frequency trading, bridges and internal trading. The dashboard currently shows $6.4 trillion in transactions tracked over 30 days, up from $313.1 billion after adjustment.
In the short term, the study could increase attention to blockchain data calculation methods. On-chain metrics will remain useful, but their scope will depend on the processing applied to transactions. For bitcoin, distinguishing technical movements and economic transfers could remain central.
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