In 2017, bitcoin not only experienced a massive 1,900 percent rally to hit an all-time high of over $20,000, it also managed to finally become a mainstream investment for the masses. Bitcoin can now also be traded on two leading US derivatives exchanges, the CBOE and the CME, in the form of bitcoin futures contracts.
How Many People Use Bitcoin?
Due to the pseudo-anonymous nature of bitcoin, it is difficult to accurately determine the number of bitcoin users around the world. Nonetheless, there is data that can give you a rough estimate of how many individual bitcoin users there actually are.
Currently, there are almost 28.5 million bitcoin wallets that hold more than 0.001 BTC according to data compiled by Bitinfocharts.com. However, most bitcoin users have several bitcoin wallets and use multiple wallet addresses to increase their financial privacy when transacting in bitcoin. Hence, the number of bitcoin users is likely less than 28.5 million.
The most popular bitcoin wallet and exchange provider, Coinbase, reportedly has over 13 million users, which would suggest that the number of bitcoin users is somewhere between 13 million and 28.5 million. Given that Coinbase is available in 32 countries and that it has emerged as the go-to bitcoin wallet for newcomers, its user base number gives a better indication of how many users there are than purely analyzing wallet addresses.
Having said that, among the countries that are not serviced by Coinbase are some of the largest bitcoin economies such as China, South Korea, and Japan. Additionally, no bitcoin users in South America or Africa can use the company’s service. Given the growing number of bitcoin users in Asia, Africa, and South America who are using other wallet providers, the number of bitcoin users has to be much higher than Coinbase’s 13 million.
Bitcoin trading volumes from peer-to-peer exchange LocalBitcoins suggest that bitcoin adoption is on the rise in economically troubled South American nations such as Venezuela, Brazil, and Colombia as well as in Africa as more and more young Africans are jumping on the bitcoin bandwagon as a way to generate an income.
In South Africa, for example, “the number of new users trading bitcoin through eToro rose by 671 percent from January to the end of November last year over the same period in 2016, more than the 574 percent overall growth,” according to eToro analyst Mati Greenspan.
Furthermore, three African nations – South Africa, Ghana, and Nigeria – are among the top five countries to search for the keyword bitcoin according to Google Trends data.
In light of the limited data and the impossibility of accurately determining the number of bitcoin users around the world, we can safely estimate that there will be around 20 million users globally.
This figure can be derived by assuming that out of the 28.5 million bitcoin wallet addresses, several are no longer in use and that many users occupy several wallets. On the other hand, we can also assume that the number of bitcoin users outside of the 32 countries that Coinbase services, will be several million – especially since major bitcoin economies in Asia are not included. Hence, around 20 million bitcoin users globally can be considered as a fair estimate.
The majority of these users will be private buy and hold investors who want to capitalize on the potential future price increase of the digital currency. In terms of actual day-to-day users of bitcoin as a spending currency, the number will be much smaller.
What We Know
What we know, however, is that bitcoin’s popularity is exploding around the globe and this will likely positively affect the price of the leading digital currency in the months and years to come.
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