Why Have Cryptocurrencies Rallied So Much? Division

Investment oldman Sachs Management Why Have Cryptocurrencies Rallied So Much? Division 1. Bitcoin Supply Over Time (Million Tokens) 2. Currency Composition of Bitcoin Purchase Volume Euro = Polish Zloty m British Pound 25 5 100% RUS Dollar m Japanese Yen © South Korean Won m Chinese Renminbi ‘yd |! ' i 90% i "I ia | I i ] PMA ul | a4 80% f A Current Supply ans = 45 - = 60% 2 2 5 50% - ” i= o 40% 2 i) 30% 5 4 20% 10% 0 BYTSRASSIFSSSSELISSISSSSILLSARIB 0% | , , , SexgSsRRGRRKRKSBBSRRRBKHRaAtSAtSnnan 2011 2012 2013 2014 2015 2016 2017 = In addition to speculation, which has been the biggest driver of cryptocurrency appreciation, other drivers include: = Perceived Scarcity: Bitcoin’s 21 million token cap is expected to be reached in 2140 (16.5 million today). Many of the over 2,000 other cryptocurrencies, however, do not have a capped supply. Further, while unlikely, bitcoin’s token cap could be raised if a consensus of programmers decided so. = Desired Safe-haven: Increased global participation reflects desire for an asset independent from governments or central banks (“digital gold”). Many governments from which investors have sought diversification, however, have recently banned domestic crypto-exchanges. 10 HOUSE_OVERSIGHT_025673 Source: Investment Strategy Group, Bloomberg, Cryptocompare.com.