Cryptocurrency Ownership Rises in the First Half of 2024

According to a recent report by Crypto.com, the global number of cryptocurrency owners increased to 617 million. This represents a 6.4% rise from the 580 million owners recorded in December 2023. The report highlights significant growth in the ownership of major cryptocurrencies, particularly Bitcoin and Ethereum.

Bitcoin and Ethereum ownership growth

Crypto.com’s market sizing report indicates a notable increase in Bitcoin and Ethereum owners between January and June 2024. The report reveals that Bitcoin owners rose by 5.9%, from 296 million in December 2023 to 314 million by mid-2024. Meanwhile, Ethereum ownership saw a more significant jump of 9.7%, increasing from 124 million to 136 million during the same period.

The report attributes the rise in Bitcoin adoption to key factors such as the fourth Bitcoin halving, which occurred in April 2024, and the launch of the Runes Protocol. The Bitcoin halving event reduced block rewards for miners, which was anticipated to impact market dynamics, driving increased interest and investment in Bitcoin. Additionally, the introduction of U.S. Spot Bitcoin Exchange-traded funds (ETFs) boosted investor confidence, leading to over $14 billion in inflows into the asset.

Ethereum’s growth in adoption is linked to improvements in its ecosystem, particularly following the Dencun upgrade in March 2024. This upgrade significantly reduced gas fees, with some Ethereum Layer 2 protocols reportedly lowering transaction costs by up to 99%. These developments have contributed to Ethereum’s increased attractiveness, encouraging more users to participate in the network.

Institutional adoption and market dynamics

The Crypto.com report emphasizes the role of institutional adoption in the expanding cryptocurrency market. The Securities and Exchange Commission (SEC) ‘s approval of U.S. Spot Bitcoin ETFs was a pivotal moment, significantly influencing market sentiments and validating the legitimacy of digital assets. The approval not only increased institutional participation but also sparked a surge in Bitcoin ownership, further solidifying Bitcoin’s position in the market.

The report also notes that between 388,000 and over 1.5 million new Bitcoin investors were drawn to the market through these ETFs. This influx of new investors underscores the growing institutional interest in Bitcoin, which continues to drive its adoption globally.

Market cap decline despite adoption surge

Despite the increase in cryptocurrency ownership, the overall market cap experienced a decline in the second quarter of 2024. CoinMarketCap data shows that the global cryptocurrency market cap stood at $2.27 trillion by the end of the year’s first half. However, this represents a 14% decrease in the second quarter, attributed to lower inflows into ETFs during this period.

On a positive note, stablecoins made a notable recovery, with their market capitalization reaching $161 billion as of June 30, 2024. This marks a two-year high, just 14.5% below the all-time high recorded in April 2022. CoinMarketCap’s analysis suggests that the increased supply of stablecoins could indicate rising capital inflow into the crypto market, potentially signaling the onset of a bull market.

The first half of 2024 saw significant growth in cryptocurrency ownership, driven by key events such as the Bitcoin halving and advancements in the Ethereum network. While the market cap faced some challenges, the continued institutional adoption and recovery in stablecoins point to a resilient and evolving cryptocurrency market.

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