Crypto User Surge 34% in 2023 Globally

The TDR Three Takeaways:

  1. Crypto User Growth: The global cryptocurrency user base grew by 34% in 2023, increasing from 432 million to 580 million, despite economic and geopolitical headwinds.
  2. Bitcoin and Ethereum Lead: Bitcoin’s user base expanded by 33% to 296 million, and Ethereum’s grew by 39% to 124 million, signifying their dominance in the digital currency market.
  3. Factors and Diversification: Growth was driven by Bitcoin ETFs, the Bitcoin Ordinals protocol, and Ethereum’s Shanghai Upgrade. There’s notable overlap in Bitcoin and Ethereum ownership, indicating diversification in cryptocurrency investments.

In 2023, cryptocurrency underwent significant expansion, with global user numbers reaching new heights. Crypto.com’s comprehensive report provides a detailed account of this growth, highlighting a surge in the global cryptocurrency user base by 34%, from 432 million at the beginning of the year to 580 million by its end. This increase occurred despite various macroeconomic challenges, including monetary tightening by Western central banks, geopolitical conflicts, and ongoing pandemic consequences.

The report reveals that Bitcoin (BTC) and Ethereum (ETH) remained the primary drivers of this growth. The number of Bitcoin owners increased by 33%, rising from 222 million to 296 million, while Ethereum saw a 39% increase in its user base, growing from 89 million to 124 million. These figures suggest a growing acceptance and diversification within the cryptocurrency space.

Several factors contributed to this growth. For Bitcoin, the development of exchange-traded funds (ETFs) and the introduction of the Bitcoin Ordinals protocol, which enabled the minting of non-fungible tokens (NFTs) on the Bitcoin network, played crucial roles. The Ethereum network, on the other hand, benefited from its Shanghai Upgrade, which introduced liquid staking and allowed for the withdrawal of staked ETH, further driving its adoption.

The report also touches on the overlap in ownership between Bitcoin and Ethereum, noting that 40.9% of Bitcoin owners also own Ethereum, while 42% of cryptocurrency users do not hold either BTC or ETH. This indicates a diversification in cryptocurrency investments among users.

In terms of methodology, Crypto.com’s report combines on-chain data with a blend of parameters to estimate global cryptocurrency ownership. This approach, while comprehensive, acknowledges certain limitations, such as potential inaccuracies in capturing over-the-counter (OTC) trading and users who have never made on-chain transactions. Despite these limitations, the report provides a valuable snapshot of the cryptocurrency landscape in 2023.

In summary, 2023 marked a year of robust growth in the cryptocurrency sector. The surge in global cryptocurrency users, driven by increased adoption of Bitcoin and Ethereum, highlights the expanding reach and evolving nature of digital currencies. This growth, achieved in the face of economic and geopolitical challenges, underscores the resilience and growing mainstream acceptance of cryptocurrencies.

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