Data & Insights: Predicting Twice; BTC Users Go on Vacation

Double Count Oopsie

• Early last week, it was revealed that almost every public data dashboard had been displaying significantly higher totals for polymarket volume than reality.
  • In simple terms, a $100 trade on Polymarket was reported as a $200 trade.
  • This was caused by a “double count" error in how Polymarket’s onchain logs were read, as both sides of the same trade were counted as if they were separate trades and then summed up, which inflated notional figures.
  • The standard industry practice is to measure one side of the trade, usually the taker side.
• As you can see in our updated dashboard, historical volume totals for prediction markets are now notably lower than previously displayed.
  • For example, for November 2025, Polymarket and Kalshi now display a combined total of $7.68 billion in true trading volume, compared to over $9 billion previously.
  • Moreover, the volume ratio of prediction markets to spot exchanges as of the end of November was 0.47%, down from the previously reported 0.57%.
  • On the other hand, as the double-count error only affected Polymarket’s public data on third-party dashboards, its updated market share is just ~25% compared to Kalshi’s ~75%, per November 2025.
  • Though it is worth noting that Polymarket’s data is publicly verifiable, whereas Kalshi’s is self-published and unverifiable.
• Despite this change, the general trend of prediction markets has remained the same, even on the truer, lower baseline, where they have continued to scale with activity, greatly expanding and new markets having deeper liquidity.
  • The double-count fix is also a good thing to happen, as we now have a true, uninflated apples-to-apples comparison between Polymarket and Kalshi.

Gone for the Holidays?

• Total open interest (OI) on BTC futures across centralized exchanges currently stands at $32.9 billion.
  • This represents its lowest figure since November 2024, prior to the conclusion of the US presidential election.
  • For context, just two months ago, total OI on BTC and the BTC price itself were standing at record highs of $64.5 billion and over $125,000, respectively.
  • Since then, BTC lost 1/3rd of its market cap while OI nearly halved, emphasizing the mass de-leveraging that has occurred. 
  • We’re also midway through December and total volume of BTC futures is currently $696 billion. If this level of activity continues, December will be the lowest traded month for BTC futures since June 2024.
• On the other hand, spot Bitcoin ETF volumes have also declined recently.
  • Through October and November, spot Bitcoin ETFs traded an average of $5.88 billion in volume per day.
  • In December so far, average daily volume traded has declined by ~30%, highlighting a glaring lack of activity and interest from TradFi institutions and crypto-native participants alike.
• Part of this can be attributed to seasonality as we approach year-end, which typically sees dampened activity as traders wind down risk and lock in their yearly returns.
  • On the other hand, declining volumes and weak price action could also point to positioning fatigue, as many allocators might have finished establishing their desired BTC exposure and have halted buying for the foreseeable future.
  • Though on the bright side, low-volume regimes like the one we’re currently experiencing often precede an expansion phase, as there is now ample room for both leverage and ETF volumes to rebuild from a much lower and cleaner starting point.

Gold Bugs Coming Onchain

• Gold-backed stablecoins have risen to over $4 billion in market capitalization, nearly tripling from approximately $1.3 billion at the start of 2025. 
  • This growth reflects both the strong performance of gold itself and the increasing appetite among crypto investors for tokenized precious metals exposure.
• Gold prices have climbed roughly 66% year-to-date in 2025, helping drive inflows into these blockchain-based gold products. The precious metal's rally has been fueled by macroeconomic uncertainty, geopolitical tensions, and persistent demand, creating favorable conditions for both physical and tokenized gold adoption.
• Tether Gold (XAUt) leads the market with approximately $2.2 billion in market capitalization, representing 50% of the total gold-backed stablecoin sector. Paxos Gold (PAXG) holds the second position at around $1.5 billion. 
  • Together, these two protocols account for nearly 90% of the tokenized gold market, with XAUt having recently overtaken PAXG following aggressive supply expansion throughout 2025.
• The growth in gold-backed stablecoins indicates that crypto investors increasingly seek exposure to traditional safe-haven assets while remaining onchain. These tokens allow fractional ownership of physical gold bars stored in secure vaults.
• Tether has emerged as a major institutional gold accumulator. The company added 26 tons of gold in Q3 2025 alone, exceeding the purchases of most individual central banks during the same period. With approximately 116 tons held by end-September, Tether ranks among the top 30 global gold holders according to IMF data, ahead of countries like Greece, Qatar, and Australia.

BTC ETF to BTC Spot Vol ratio

• As Bitcoin prices have chopped through December 2025, a notable divergence has emerged between traditional finance participants and crypto-native traders. While spot ETF volumes have steadily gained market share, sentiment across crypto social media has deteriorated following the sharp October drawdown.
  • The BTC ETF to BTC Spot volume ratio has climbed to approximately 29% in December 2025, up from around 15% at the start of the year. This steady upward trend reflects growing institutional and retail participation through regulated bitcoin products, even as broader market sentiment has fluctuated throughout the year.
• Following the October 10th crash when Bitcoin plummeted from $126,000 to below $107,000 amid mass liquidations, crypto-native sentiment turned notably pessimistic. Crypto Twitter saw widespread frustration, with some people questioning the future of the industry.
  • Traditional finance participants, however, have maintained relatively consistent engagement. Bitcoin ETF volumes have remained steady or even grown in the weeks after 10/10.
• The rise in ETF volume share has provided an important stabilizing force for crypto markets throughout 2025. Unlike many leveraged crypto-native positions that amplified October's cascade, ETF flows represent unleveraged spot buying from investors who typically maintain longer time horizons.
  • This divergence shows how Bitcoin's investor base has evolved. Traditional finance channels now account for a meaningful portion of daily volume, potentially reducing the impact of sentiment swings among highly leveraged crypto-native traders. The question moving forward is whether this institutional participation can continue providing downside support during periods of market stress, or if sustained price weakness might eventually test the conviction of newer ETF participants.

Where Are The Bitcoin Users?

• Bitcoin network activity has declined to 12-month lows as the year draws to a close, with the 7-day moving average of active addresses falling to 660,000. While seasonal slowdowns are expected, we’re spotting weakness across multiple network metrics.
  • Active addresses currently sit at their lowest levels since December 2024, when the network experienced peak activity from Ordinals and Runes speculation. 
  • The weakness in network activity has also placed downward pressure on miner economics. Daily miner revenue has declined from an average of $50 million during Q3 2025 to roughly $40 million as the year closes. This revenue is almost entirely composed of block subsidy rather than transaction fees, highlighting limited demand for Bitcoin blockspace.
• An unusual dynamic has emerged within Bitcoin's transaction composition. Runes transactions now account for a larger percentage of total network transactions, yet contribute only 5-10% of total fee revenue. 
  • When you make a transaction on Bitcoin, you can set the fee rate (sat/vB). Bitcoin miners will then prioritize transactions based on this reward. 
  • Runes transactions are often submitted with very low fees, but due to the cheap blockspace, these transactions are picked up, accounting for a larger share of total transactions. 
• The high transaction count but minimal fee generation from Runes raises concerns over the demand for blockspace. When half of Bitcoin's transaction throughput generates negligible fees, it suggests a mismatch between network utilization and value creation.
  • As block subsidies continue to diminish with each halving cycle, sustainable miner revenue will increasingly depend on transaction fees from users willing to pay for scarce blockspace.