Number of Global Cryptocurrency Owners Surged in 2023
A recent report by Crypto.com revealed that the number of global crypto owners increased by 34% in 2023, reaching 580 million by December. Bitcoin ownership saw a surge of 33%, while Ethereum experienced an even larger growth of 39%. The report attributes the rise in bitcoin adoption to the approval of spot bitcoin exchange-traded funds (ETFs) and the introduction of the Bitcoin Ordinals protocol, which allowed for the creation of non-fungible tokens (NFTs) on the Bitcoin network. Additionally, strong institutional interest in bitcoin also contributed to its adoption. For Ethereum, liquid staking following the Ethereum Shanghai Upgrade and the transition to Proof of Stake (PoS) played a significant role in its adoption growth.
Macro Headwinds Did Not Dampen Crypto Adoption
Despite various macro headwinds, including monetary tightening by Western central banks, ongoing conflicts in Europe and the Middle East, and the lingering impact of the pandemic, the number of crypto owners worldwide continues to rise. According to the Crypto.com report, global cryptocurrency owners increased from 432 million in January to 580 million in December 2023, marking a significant 34% growth. This growth can be attributed to the increasing adoption of bitcoin and Ethereum, driven by factors such as the approval of bitcoin ETFs, the introduction of the Bitcoin Ordinals protocol, and the transition to PoS for Ethereum.
Institutional Interest and Liquid Staking Fuel Adoption
One of the key drivers behind the adoption of bitcoin was the interest shown by institutional investors. The report highlights that institutional investors played a crucial role in the increased adoption of bitcoin in 2023. Furthermore, the development of bitcoin ETFs and the Bitcoin Ordinals protocol, enabling the creation of NFTs and fungible tokens on the Bitcoin network, contributed to its growth. For Ethereum, the report points out that the adoption growth was mainly due to liquid staking after the Ethereum Shanghai Upgrade. This upgrade allowed for the withdrawal of staked ETH following the transition to the PoS blockchain.
Crypto Market Continues to Evolve with ETF Approvals
In January 2023, the U.S. Securities and Exchange Commission (SEC) approved 11 spot bitcoin ETFs, a significant milestone for the cryptocurrency market. These approvals, including the conversion of Grayscale’s bitcoin trust into an ETF, have had an impact on the market. Grayscale, in particular, experienced major outflows following the launch of its ETF, while other spot bitcoin ETFs, such as Blackrock’s Ishares Bitcoin Trust, witnessed significant inflows. The approval of bitcoin ETFs by the SEC reflects the increasing acceptance and integration of cryptocurrencies into traditional financial systems.
Hot Take: Cryptocurrency Adoption Soars as Investors Embrace Bitcoin and Ethereum
The Crypto.com report highlights the remarkable growth in the number of global cryptocurrency owners in 2023. With a 34% increase, the total number reached 580 million by December. Bitcoin and Ethereum saw significant adoption, driven by factors such as the approval of bitcoin ETFs, the introduction of the Bitcoin Ordinals protocol, and the transition to PoS for Ethereum. Institutional interest played a crucial role in bitcoin’s adoption, while Ethereum benefited from liquid staking. These trends indicate that cryptocurrencies are becoming increasingly mainstream and integrated into the global financial landscape.
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