From Asset to Public Good: Measuring Bitcoin’s Success via Adoption Dynamics

This study examines the dynamic interplay among development effort, adoption, and market value in shaping Bitcoin’s long-term success. Drawing on over 14 years of high-frequency data, we employ a time-series framework that integrates vector autoregression (VAR), Granger causality tests (GCT), and impulse response functions (IRF). The analysis demonstrates that adoption is the pivotal mechanism linking development and value, as increases in adoption consistently precede growth in developer activity and market capitalization. These findings position Bitcoin as a public good, where success is primarily derived from collective use and broad public consumption, rather than price dynamics or technical sophistication alone. By empirically addressing the longstanding “chicken-and-egg” dilemma in Bitcoin research, the study establishes adoption as the most comprehensive predictor of Bitcoin’s trajectory. The results challenge price-centric perspectives and highlight the need to conceptualize Bitcoin as a sociotechnical infrastructure underpinned by voluntary development, financial valuation, and, above all, public engagement.