More than $1 billion worth of bitcoin changes hands every day on the major cryptocurrency exchanges, according to VanEck’s ETF (exchange-traded fund) proposal to the SEC.

But that figure vastly understates bitcoin’s trading volume. It’s actually much, much higher.

VanEck’s estimate is based on exchanges that follow anti-money-laundering (AML) and know-your-customer rules. Dozens of exchanges – some of them very large – were excluded.

According to CoinMarketCap, which includes many of those “unregulated” exchanges, bitcoin’s total daily volume ranged from $3.5 billion to $5.5 billion in the last week alone.

But even CoinMarketCap underestimates bitcoin’s true trading volume.

Volume Building Despite Tough Environment

Remember, these volumes were achieved while accompanied by occasional hacks, little regulatory guidance, bans and various government restrictions, and user-unfriendly exchanges. The number of hoops investors jump through in order to buy or sell cryptocurrencies on exchanges is unbelievable.

To say it’s been less than an ideal environment is an understatement.

What’s more, these volumes were also achieved without the participation of the vast majority of institutional investors.

This is pretty well known.

What’s not well known?

That a small, exclusive group of around 20 well-heeled investors have been making huge bets in bitcoin since last year.

While small in number, they’re responsible for billions of bitcoin being traded “behind closed doors” every month. VanEck estimates these whales trade between $250 million and $500 million in bitcoin every day.

Operating in the Shadows

These guys don’t use exchanges like Coinbase. And for good reason. As I mentioned earlier, these exchanges are cumbersome to use. They’re exposed to the prying eyes of government agencies. They’re subject to cyberattacks. And they’re far too public. More on this last point…