How many people use bitcoin? It is hard to say, but there are a few data points that provide some tantalizing clues.
Bitcoin Users At a Glance
- Almost 22 million bitcoin wallets have been set up globally.
- An estimated five percent of Americans hold bitcoin.
- 2.9 to 5.8 million active bitcoin users according to a Cambridge University study.
- Leading exchange Coinbase has over 13 million users.
- Emerging markets users – who are often not considered in statistics – are
likely in the millions.
Let’s unpack those numbers a bit.
22 Million Bitcoin Wallets
Currently, there are almost 22 million bitcoin wallets 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 22 million.
2.9 to 5.8 Million Active Users
A 2017 study by the Cambridge Centre for Alternative Finance suggests that “current number of unique active users of cryptocurrency wallets is estimated to be between 2.9 and 5.8 million.” It is important to note that this study focuses on active users as opposed to bitcoin “hodlers”. This gives us insight into how many individuals are actual users as opposed to only buy-and-hold investors.
The Cambridge University study collected data from over 100 cryptocurrency companies in 38 countries, which is estimated to encapsulate 75 percent of the blockchain industry. Hence, we can expect the number of active users to be on the higher end of the study’s estimate or perhaps even higher.
5 Percent of Americans Hold Bitcoin
A survey conducted by the Global Blockchain Council and SurveyMonkey that was taken by 5,000 Americans found that 60 percent of Americans have heard of bitcoin and that around five percent hold the digital currency. If you would extrapolate that to the entire U.S. population, that would mean that an estimated 16 million Americans have invested in bitcoin.
Coinbase’s 13 Million+ Users
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 22 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 User Growth in Emerging Markets
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.
So, How Many People Use Bitcoin? Here’s the Math!
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 22 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.
Bitcoin as Spending Currency Vs. Other Payment Methods
While bitcoin’s popularity exploded in 2017, the actual number of bitcoin users globally is still rather small compared to users of other payment systems such as Paypal or credit cards. While active bitcoin users are estimated at 5.8 million, PayPal boasts 235 million active users, Mastercard has 35.7 million American users and another 604 million active international users, and Visa accounts for a whopping 336 million American users and another 736 million users globally.
What We Know
What we know, however, is that bitcoin’s popularity is expanding around the globe, meaning that this digital currency is likely here to stay.
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