Where are We in The Adoption of Cryptocurrency

With the rise in popularity of Cryptocurrency over the past 2 years you must be wondering. Am I an early adaptor of Cryptocurrency? After all, history has shown us that the earlier you get in on a new, widely accepted idea the more profit there is to make. With this in mind we must also understand the risks involved.


What is Cryptocurrency:

Cryptocurrency is a virtual asset that is secured by cryptography which makes in almost impossible to counterfeit. Many of these cryptocurrencies are on decentralized networks based on blockchain technology which is a distributed ledger that is enforced either by proof of work or more recently proof of stake. This means computers or nodes validate each transaction made and are also rewarded with some of that coin as a reward for securing the network. This means that there is no central authority, meaning that not one central origination or person can interfere or manipulate the currency.


How Many People Own Crypto:

Coinbase:

One of the most popular exchanges Coinbase has over 98 million registered users with a confirmed phone number or email address as of 3/31/22. Along with the 98 million users the quarterly volume traded was around $309 Billion dollars, $256 Billion assets on the platform in over 100 countries. If we compare the amount of users now to the estimated number of Q1 in 2021 the number of users nearly doubled, 56 million registered and verified users around Q1 2021. We can also take a look at the estimated number of users in Q1 of 2020 which was around 34 million. Based off this data there are still many users creating accounts on this platform and many more to come.


Crypto_com:

While we don't have any official statement or report clarifying how many users are on this platform we do have a tweet from Kris the CEO. He has stated that they have 10s of millions of users which is estimated to be around 20,000,000 users.



Ethereum Unique Address Chart:

On Etherscan we can view a chart that shows the number of unique Ethereum wallet addresses. In January of 2021 there were roughly 86 Million addresses with a daily increase of around 90,000 addresses per day. Currently as of 5/9/2022 there are 196 million unique ethereum wallet addresses with close to 100,000 unique addresses being made per day. While this does not give us an accurate count of how many people own or hold Ethereum, it shows us that people, now more than ever, are using the block chain.

Bitcoin Unique Address Chart:

We can also observe the number of unique wallet addresses for BTC on statista. This chart shows the number of unique addresses in millions from November 2011 to April 6, 2022. This chart clearly indicates that even close to the end of 2021 there is still many people hopping on board. We can see that on April 6th 2022 there is an estimated 82.22 million unique BTC wallet addresses while at the start of 2021 there were 66 million.

Current Users vs the Stock Market:

The best data to compare crypto holders to are investors in the stock market. While anyone could open up an account in either the stock market or on a crypto exchange within a matter of seconds, there are many people who still haven't started investing. According to a Survey of Consumer Finances the Federal Reserve did in 2019 roughly 54% of all US families own publicly traded stocks. With a population of around 331 million and 24% of the population under the age of 18. This leaves roughly 251 million people over the age of 18 in the USA. All of these people are able to invest in either the stock market or crypto. Taking into consideration that about 54% invest in the stock market, and that people in the stock market are more likely to invest into other assets that leaves about 135 million Americans. With a very rough estimate of 128 million accounts on Coinbase and Crypto_com we can conclude that crypto exchanges are becoming just as popular if not more popular than the stock market.

Comparing to the Early Adoption Curve:

Without having all of the user account data from the most popular exchanges it is hard to understand where we are on this curve. However with the data from the U.S we can make some assumptions and get an extremely rough estimate of where we are. Currently the world population is around 7,946,165,000. If we take into account that maybe half of these people will invest and about 24% of the population is under the age of 18 and unable to invest we get about 3,019,542,700 people that could theoretically invest into crypto. Here we will use the number of unique Eth and Btc wallet addresses as these are the two most popular coins. So there are around 278 million unique addresses if we take 278/3019542700 we get 9.2%. This leaves us at the early adopters stage on the curve.


Adoption in Big Businesses:

Throughout the year we have seen large banks such as VISA or Goldman Sachs purchase crypto and even NFTs. We have also seen a wave of popular exchanges like Venmo, Paypal and Cash App allow users to exchange ETH and BTC. With faster transaction speeds and depending on the blockchain lower fees we have seen many large companies come into the crypto space.