Bitcoin is used significantly more for speculation than for everyday payments, although its role as a payment method has grown in recent years. The majority of Bitcoin activity revolves around trading, investment, and holding as a store of value rather than routine transactions for goods and services.
Bitcoin’s original design by Satoshi Nakamoto was to create a decentralized digital currency for peer-to-peer payments without intermediaries. However, over time, Bitcoin has evolved primarily into a speculative asset. This shift is driven by its limited supply—only 21 million Bitcoins will ever exist—and its deflationary nature, which encourages holding rather than spending. As of 2025, over 93 percent of all Bitcoins have been mined, with about 15.5 to 16 million effectively circulating after accounting for lost coins. This scarcity has made Bitcoin attractive as a store of value and hedge against inflation, similar to digital gold[3].
From a usage perspective, Bitcoin’s network processes hundreds of thousands of transactions daily—over 500,000 transactions in 24 hours as of October 2025, with daily transaction volumes averaging around $28.46 billion. There are roughly 300,000 to 500,000 unique users transacting daily, and about 30 million monthly active on-chain addresses. Despite these figures, the number of users actively using Bitcoin for payments is relatively small compared to the total number of holders and traders[1].
The speculative nature of Bitcoin is evident in the massive trading volumes on exchanges. For example, Binance users trade over $11.5 billion worth of cryptocurrency every day, with Bitcoin making up about half of the total crypto market capitalization. The user base of major exchanges like Coinbase has grown from 23 million in 2018 to over 110 million today, indicating a large community focused on trading and investment rather than spending Bitcoin as currency[2].
On the payment front, there has been some growth. In 2025, crypto payment use rose by approximately 45 percent, and about 50 percent of small and medium-sized enterprises (SMEs) now accept Bitcoin or stablecoins. This shows increasing merchant adoption, especially in urban areas and among younger users aged 25 to 34. However, even with this growth, payments still represent a smaller fraction of Bitcoin’s overall activity compared to speculation and investment[1].
Several factors contribute to Bitcoin’s limited use as a payment method. Its price volatility makes it less practical for everyday transactions, as the value can fluctuate significantly within short periods. Transaction fees and confirmation times, although improved with technologies like the Lightning Network, can still be barriers for small or frequent payments. Additionally, regulatory uncertainty and tax implications in many countries discourage widespread use of Bitcoin for routine purchases.
In some regions, Bitcoin is used more as a payment tool due to local economic conditions. For example, in countries with high inflation or unstable currencies like the Philippines, Iran, and Brazil, Bitcoin and other cryptocurrencies serve as alternatives for remittances and financial services, providing a lifeline when traditional systems are unreliable. Even so, these use cases are often driven by necessity rather than preference, and speculative trading remains dominant globally[5].
In summary, while Bitcoin’s use as a payment method is growing and becoming more accepted by merchants and users, the overwhelming majority of Bitcoin activity is speculative. Most users hold Bitcoin as an investment or trade it on exchanges rather than use it for everyday payments. This dual nature—part digital gold, part currency—defines Bitcoin’s current role in the financial ecosystem.