Cryptocurrency update: global crypto userbase soars

The first half of 2021 sees record numbers of people engaging with cryptocurrency markets.

Crypto update

Global cryptocurrency users skyrockets in H1

The number of people actively using and trading digital tokens exploded in the first half of 2021 according to data from Crypto.com.

Data was taken from 24 digital asset exchanges, including Binance, Bitfinex, and Gemini.

Up to June 30th, 220,000,000 people – more than the population of Brazil – have had some level of interaction with cryptocurrencies this year. In January, the figure was closer to 106 million.

Crypto.com states its Bitcoin that’s driven the largest number of new users.

“We can see that January, February, and April were exceptionally strong months, driven by Bitcoin’s stellar performance,” Crypto.com said in a statement. “However, May was also extraordinary, given Bitcoin and Ethereum’s price plunge.

“Notably, it only took four months to double the global crypto population from 100 million to 200 million. By comparison, it took nine months to reach 100 million from 65 million since we began tracking these numbers.”

Institutional support also drove up the numbers.

“Bitcoin led growth from January to April, as heavyweight institutions like PayPal, MicroStrategy, Visa, and Mastercard announced plans to support crypto,” said Crypto.com Similarly, Ethereum saw significant growth in May and June as institutional investors continued to favour the token.”

In terms of altcoins, i.e., not mainstream tokens like BTC or Ether, it was perennial meme favourites Dogecoin and spin-off Shiba that helped attract more retail clients.

Bitcoin drops off on US infrastructure bill uncertainty

If you’re a keen crypto market follower, you’ll probably know that Bitcoin has had a bit of a struggle recently.

Falling away from record highs seen earlier in the year, the token has struggled to gain meaningful momentum. It climbed above $42,000 on Saturday, but as of now has fallen back below the $40,000 mark.

One of the key reasons for this is uncertainty around the new proposed $1 trillion US infrastructure bill currently being debated.

Provisions within the bill call for about $28bn to be generated from taxing cryptocurrency transactions. Bitcoin, being the most popular crypto for US and global traders, hasn’t responded well to this proposed idea. In fact, traders have got cold feet regarding Biden’s plans.

The definition of the word “broker” for tax purposes is what’s riling up BTC traders. In the amended bipartisan bill, people who provide digital asset transfers would be treated as a broker, thus be susceptible to greater information reporting and taxation requirements.

“Any person who (for consideration) is responsible for regularly providing any service effectuating transfers of digital assets on behalf of another person” is now included in the definition, according to the bill.

This has caused a lot of doubt, fear, and uncertainty around the whole US BTC sector.

Other factors at play include China’s central bank aping the CCP’s tough crypto stance. The People’s Bank of China has said it will continue to crack down on digital asset trading throughout China, citing financial risks to the Chinese economy.

Bitcoin has now slumped 5.5% from its Saturday high.

Ether whales move over $500m in hours

Whales holding onto large Ether caches moved over half a billion dollars’ worth into new wallets last week.

Research from blockchain tracker Whale Alert revealed multiple transactions had taken place on Friday.  236,419 ETH tokens, worth approximately $$557,777,068, was moved in one ten-hour window.

Here’s the breakdown of key transactions:

• 36,168 ETH worth $89.1 million transferred from unknown wallet to unknown wallet.
• 36,168 ETH worth $88.4 million transferred from unknown wallet to unknown wallet.
• 33,000 ETH worth $79.8 million transferred from unknown wallet to unknown wallet.
• 25,119 ETH worth $59 million transferred from unknown wallet to unknown wallet.
• 5,891 ETH worth $13.9 million transferred from unknown wallet to Gemini.
• 33,000 ETH worth $77.5 million transferred from unknown wallet to unknown wallet.
• 6,487 ETH worth $15.1 million transferred from OKEx wallet to unknown wallet.
• 6,309 ETH worth $14.7 million transferred from unknown wallet to Binance.

Interestingly, ETH is trading down. Bitcoin falling tends to bring all of the other key tokens down with it, and Ether is no exception. The above tells us that there’s significant behind-the-scenes interest in ETH, as well as the scale of coins held by moneyed investors. Could these be institutional? It’s hard to say.