According to a study from the University of Cambridge's Centre for Alternative Finance, the number of people using cryptocurrency doubled in 2018, despite the steady decline in value of most cryptocurrencies this year.
Growing Account Activity
The study’s most interesting finding was that the total number of “active” cryptocurrency accounts doubled in the first three quarters of 2018.
The researchers noted that defining what constitutes an “active” cryptocurrency account can vary because the report studied crypto accounts on a variety of platforms and users interact with those platforms in different ways. But, in general, the report defined active accounts as those that were logged into at least once a week, or performed other actions — such as withdrawals or deposits — at least once a month.
The total number of active crypto accounts in 2018 represented only 38 percent of all crypto accounts in existence. However, that figure reflects a slight increase in user activity since 2017, when only 37 percent of the total accounts in existence at the time were considered active, according to the study.
Lest crypto advocates become too excited, the researchers found a fourfold increase in the total number of active crypto accounts during 2017, compared with only a twofold increase during the first three quarters of 2018. So, the rate of new active account creation is slowing, even though total numbers continue to grow.
Still, it’s noteworthy that total active accounts continued to grow at all during a period when most cryptocurrencies lost value. The value of bitcoin, for instance, has declined by nearly 80 percent since the start of 2018. Most other cryptocurrencies have followed similar trajectories.
The report presented several other notable findings as well, including the following:
- Eighty-four percent of crypto companies studied now support multiple coins, up from 47 percent last year.
- Crypto mining operations are more geographically dispersed than many people think, and Canada and the U.S. are seeing especially high rates of mining growth.
- A growing number of crypto companies are undertaking efforts to comply with regulatory laws proactively, even if regulators are not actively working to impose requirements on them.
- The number of people employed in the crypto industry continues to grow, with a 164 percent increase during 2017.
- A majority of crypto companies serve users who live in the same geographic area where the companies are based. This finding suggests that, despite the border-agnostic nature of crypto and regulatory concerns in certain countries, crypto companies remain more focused on serving local or national bases of customers than on trying to cater to the global community.
- The total value of crypto assets stolen to date amounts to $1.5 billion.
As for future predictions, the researchers suggest that stablecoins, off-chain payment networks like Bitcoin’s Lightning Network and multi-coin support will prove important areas of focus for crypto businesses in 2019.