HomeCryptoCoinbase CTO: 60x increase in crypto adoption

Coinbase CTO: 60x increase in crypto adoption

While reading this tweet, a question instantaneously pops up in our minds.

Does 8% of US citizens really own cryptocurrency?

And — while such claim seems disproportionate — Srinivasan, the Coinbase CTO, has some research to back it up.

He quotes a Finder research according to which 7.95% of US Americans own cryptocurrency but there actually some other studies that estimate amounts that are even higher.

coinbase cto

According to a research conducted by Dalia Research, 9% of US Americans own cryptocurrencies, and the average amount of people in any nation that holds some is 7%.

This means that the claim that 8% of Americans own cryptocurrency is surprisingly credible, but what about the reasoning behind the estimated adoption?

Is cryptocurrency adoption like smartphone adoption?

The estimate for the adoption growth is actually based on the assumption that the potential adoption of cryptocurrencies resembles the current adoption of smartphones.

Is that correct?

In technology, quite often, both development and adoption are exponential. Usually, new technologies are not so good and quite expensive (just like smartphones around ten years ago). But then, progress in their development starts to accelerate and — as a consequence — their adoption accelerates as well.

coinbase cto

That’s exactly what happened in the case of smartphones.

In one year — from 2005 to 2006 — the adoption increased only by 1%. But the adoption continued to accelerate, and from 2010 to 2011 there has been a 15% increase. Are there any similarities with cryptocurrency?

Well, one thing that sure has exponentially accelerated is development. The first cryptocurrency, bitcoin, had been created in 2009 and it remained the only one in existence until 2011 when litecoin, namecoin and swiftcoin have been introduced all during the same year.

According to WikipediaThe number of cryptocurrencies available over the internet as of 10 April 2018 is over 1565 and growing.”

Many — if not most — of those are so-called “money grabs” or scams.

But some substantial progress in development is indeed being made.

We now see that cryptocurrency can do much more than standard money and Bitcoin can. Ethereum has introduced smart contracts, EOS has introduced blockchain interoperability as a mean to obtain near-unlimited scalability and all of that sums to cryptocurrency being ever more advantageous and practical for even more use cases.

Many would say that user-friendliness is an insurmountable obstacle to mainstream adoption, but substantial progress is being made on that front — human-readable account names introduced by EOS for example — as well and many would argue that it is actually one of the easier to crack nuts in this space.

What should we expect from the future of cryptocurrency adoption

While the market movements this year may not have been the most pleasant ones, the mainstream attention given to this technology has substantially increased.

HTC and Huawei (probably) are working on the first “blockchain native” smartphones, Microsoft has adopted blockchain as means of authentication, Facebook has created a blockchain research team, and the Opera browser is going to integrate an Ethereum wallet.

Many more examples of similar news could be given, but just those examples are more than enough to say that something has definitely changed. Cryptocurrencies and blockchain aren’t just used by some fringe community, they are becoming corporate tools and infrastructures.

The adoption should definitely accelerate thanks to the integration of blockchain and cryptocurrency into mainstream products and service or when they are proposed by well-established companies which are starting to happen.

How many people would use cryptocurrency if some were airdropped to them by Facebook into a wallet which is part of the Facebook app? How many would use them if Amazon would start accepting them and they were integrated into google wallet or PayPal?

Sure, many such situations wouldn’t be really decentralized as much as Bitcoin or Ethereum are — since most wallets like that would be expected not to grant access to the private keys — but after some cryptocurrencies become mainstream more will probably follow.

The cryptocurrency and blockchain development is seemingly reaching a tipping point where scalability and user-friendliness are just starting to be practical for the first mainstream, corporate and institutional uses (just like the Estonian e-residency program). Adoption is just starting and it will only accelerate from now on. The thing that will probably slow the adoption the most — from now on — is regulation.

Adrian Zmudzinski
Adrian Zmudzinski
Adrian is passionate about technology and Information Technology (IT). Adrian specialized in the analysis of tokens, the blockchain technology, and cryptocurrencies. His interest in Bitcoin dates back to 2009 and it rapidly transformed into a more general interest of the still arising cryptocurrency industry. His analyses are concerned mostly by the technological potential underlying the analyzed token.
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