Cambridge Study – About Six Million Global Cryptocurrency Users as of May
For an asset sector that is currently so small, ask yourself; why is there so much press devoted to cryptocurrencies? Why are governments, banking institutions, investment banks, and central banks embracing the technology? Why are governments leaving them alone? Why did Japan legalize bitcoin as legal tender?
Some of the results of the University of Cambridge study titled, Global Cryptocurrency Benchmarking Study can be summarized as:
- The current number of unique active users of cryptocurrency wallets is estimated to be between 2.9 million and 5.8 million. This was as of May, so I expect these numbers to be higher.
- At least 1,876 people are working full- time in the cryptocurrency industry, and the actual total figure is likely well above two thousand when large mining organisations and other organisations that did not provide headcount figures are added.
Once again, I find it interesting that this industry is so small, yet global governments, central banks, investment houses, and the media are consumed by it and are exerting a lot of resources promoting its technology.
“Cryptocurrencies such as bitcoin have been seen by some as merely a passing fad or insignificant, but that view is increasingly at odds with the data we are observing,” – Dr Garrick Hileman, Research Fellow at the Cambridge Centre for Alternative Finance (CCAF) at Cambridge Judge Business School, who co-authored the study.
Digital Currency Use Higher in Areas With Less Stable Currencies
A significant portion of cryptocurrency users are from North America, while the majority are based in either Europe or the Asia-Pacific region – as shown in the graphic below. North American users seem to be the most skeptical as they continue to have the most faith in their home currencies.
I predict there will be high rates of growth in cryptocurrency use as the faith in fiat currencies fades from here on out. Only time will tell whether the cryptocurrencies that are currently on top will remain so in the future. So, invest wisely, and diversify your virtual currencies.
Indeed, there are a lot of variables at play here but, according to Ronnie Moas, an analyst at Standpoint Research, “I have concerns about cryptocurrency but my bias right now is thinking that this is something legitimate and that it is too late for regulators and the (threatened) financial services industry to get this back in the box the same way yellow taxis can’t get Uber back in the box. Just as Uber is now too big to crack down on, so are bitcoin and ethereum….”
Cryptocurrency Trading Platforms Going Mainstream
Over the past few years, a number of legitimate virtual coin wallet services and trading platforms have come online to the masses. They allow the average investor to buy and sell cryptocurrencies and hold them in wallets.
Coinbase is a digital currency wallet and trading platform where merchants and consumers can transact with new digital currencies like bitcoin, ethereum, and litecoin. It is the largest cryptocurrency trading platform and wallet service in the world. It runs GDAX. The backers of Coinbase include some of the most respected names in silicon valley private equity. Coinbase claims to have 8.5 million users. I assume that many have multiple accounts with retail establishments beginning to take them. However, I think the 2017 Cambridge study’s numbers may be already outdated in some respects.
One advantage that some of these better known virtual currencies hold over gold and silver is that they may be marginable and can be used as collateral in financial transactions.
I own a few thousand dollars in my Coinbase wallets. I am looking at litecoin with particular interest and will continue to add on any pullbacks. Keep in mind I am not gambling with emergency funds.
Are Gold and Silver Prices Beginning to Reflect the New Reality?
According to Reuters, U.S. Mint American Eagle gold coin sales in the first half of 2017 were the lowest for this period in a decade, while sales of silver in the period were the weakest since 2008.
U.S. Mint sales of American Eagle gold coins totaled 6,000 ounces in June, down 92 percent from June 2016 and bringing the tally for the first half of the year to 192,500 ounces.
Sales of American Eagle silver coins totaled 986,000 ounces in June, down 65 percent from a year ago. This brought sales for the first six months of 2017 to 12.2 million ounces, the weakest for the period since 2008.
Is this just coincidence?
According to this article from Bitcoin News Service, more and more people are conflating gold and silver with the cryptocurrencies. While I see this prospect as mind-blowing, the trend seems unmistakable nonetheless. So, unless these currencies blow up, I do not see this trend reversing.
According to the article, “these numbers (of users in the Cambridge Study) stated in the report are expected to go up in the coming days as more countries consider legalizing the cryptocurrency (bitcoin). Increasing demand for cryptocurrencies due to various geopolitical factors and growing community size will see its value increase further, eventually crossing the total value of gold which is estimated to be around $7 trillion.”
Imagine, if this is the case. I see Bitcoin as the globalists’ response in its war on gold. This article says matter-of-factly that cryptocurrencies will eventually eclipse gold as a store of wealth. Currently all the cryptocurrencies are worth less than $100 billion.
While I cannot imagine how nations will let these currencies grow to this level without acting, as they will compete directly with national fiat currencies, I do see the structure of many national currencies becoming part of this phenomenon. More and more central banks will try to keep up by embracing blockchain technology.
But, as Ronnie Moas, the analyst at Standpoint Research says, the toothpaste is out of the tube and there is nothing that can be done to put it back. Virtual currencies and the blockchain technology are here to stay.
The prophet Ezekiel warned that people shall cast their silver in the streets, and their gold shall be removed: their silver and their gold shall not be able to deliver them in the day of the wrath of the LORD.
Maybe Ezekiel did not understand the role of cryptocurrencies in the last days. But, based on how gold and silver are behaving maybe people will look at their gold and silver holdings with the same disdain.