2020 has been a massive year for crypto adoption. In July alone, over 3.5 million crypto wallet app downloads took place – a significant increase of 81% on July 2019. In addition to this, the number of active users increased by 110% between the start of January 2020 and August.
According to a report by Madeline Lenahan on behalf of Apptoppia, the boost in crypto app adoption can be traced back to the arrival of COVID-19 global lockdown measures. Logically, it appears that one of the driving forces behind more users getting to grips with cryptocurrencies can be found in Coronavirus creating more time for individuals to spend on educating themselves and embracing the world of crypto.
In 2019, the number of downloads for crypto wallet apps consistently averaged just below two million per month – with May and June being the only months where this figure was surpassed.
Discussing her results, Lenahan said: “Cryptocurrency is becoming increasingly mainstream in emerging markets, particularly in regions of Africa. Crypto.com, for instance, has seen a 339% increase in new installations from Nigeria in the past 90 days. Coinbase has seen a 113% increase there.”
But what does this considerable increase in crypto wallet adoption mean for the wider world of cryptocurrencies? In a world that’s set to be reeling from the widespread devastation caused by COVID-19, is there hope for another Bitcoin boom to inspire investors away from the adverse economic climate?
Accessibility is The Key to The Future of Crypto
Cryptocurrency wallets have come a long way in recent times and can possess an array of various advanced capabilities – with both offline and online storage options and varying levels of security and convenience available to users.
While Apptopia data shows Coinbase and Crypto.com at the forefront of crypto wallet usage with 969,000 and 576,000 users per day respectively, usage rates for both cryptocurrency exchanges and non-KYC crypto exchanges have also increased.
(Image: Daily Fintech)
Interestingly, while downloads of crypto apps are steadily increasing, the number of users of blockchain-based wallets seems to be almost-doubling on a year-on-year basis. This rate of growth has caused some crypto websites to draw parallels with the early growth of the internet.
In the graph above, it’s clear that there’s something of a correlation between the opening of crypto wallets and adoption of the internet. If this pattern continues, then it may ultimately point towards over 200 million blockchain wallet users by the end of the decade.
Just as the early internet was host to a browser gold rush, crypto wallets are set to battle it out to become the most favoured by new waves of adopters across the world. With news of huge corporations like MasterCard and Rakuten setting out to develop cryptocurrency wallets, it appears that a significant battle will take place for prominence as more users turn to crypto.
Furthermore, Samsung and HTC have already built cryptocurrency wallets with a view of tapping into the burgeoning market with better levels of accessibility. However, the battle for the best crypto wallet could yet be won by companies that offer the best resilience in the face of security threats. Logically, as adoption becomes more widespread, so too will the number of cyber threats looking to steal crypto assets.
Could Adoption Lead to a Bitcoin Boom?
As a highly speculative market, higher adoption can certainly provide healthy boosts to token values across the cryptocurrency landscape. Bitcoin, as the oldest and most popular cryptocurrency will likely be the chief beneficiary of fresh adopters, however, the rise of DeFi on Ethereum’s more advanced blockchain may see high volumes of investment among adopters.
The biggest advantage of an exponential increase in cryptocurrency adoption will be based around greater levels of integration into everyday retailers.
Currently, as the world’s most mainstream cryptocurrency today, Bitcoin is already accepted at over 100 popular retailers like Microsoft, Expedia and Overstock.com – but with accelerating adoption, the token can really branch out and convert itself into a practical unit of finance, as opposed to an investment opportunity.
With greater adoption comes more retailer acceptance, and with it, the number of transactions, wallets created and overall Bitcoin holdings as more users choose to buy Bitcoin to pay for goods and services.
The combination of adoption and retailer acceptance can also help to push regulators into acting quicker to accommodate cryptocurrency into domestic economic frameworks, paving the way for more users to work with the likes of Bitcoin and integrate it into their business models.
While there are clear signs that multiple factors that can drive a Bitcoin boom are beginning to fall into place, it’s worth looking at the role that decentralized finance may play in adoption.
Better known as DeFi, decentralized finance is a series of blockchain-based financial services that can deliver smart contracts without the need for middlemen such as lawyers or mediators between parties, and insurance among much more applications.
DeFi is developing at a rapid rate, which led to a brief boost in the value of Bitcoin before downturns in global markets put an end to the steady growth.
The significance of DeFi is that it has finally begun to deliver on the promise of blockchain technology. For all the excitement about decentralized units of finance, DeFi finally makes it practical to use large sums of crypto.
While DeFi operates largely on the Ethereum blockchain, its arrival has made for one of the most significant developments in the crypto landscape since Bitcoin’s famous 2017 rally. Given the exceptional circumstances that investors have had to contend with so far in 2020, the rest of the year could be telling for the revival of the glory days of Bitcoin.