The crypto industry is witnessing unprecedented growth, with a surge in user activity and adoption, according to the State of Crypto Report 2024 published by a16z, a leading Web3 venture capital firm. The report highlights a significant increase in the number of monthly active addresses, which have tripled since the end of 2023, reaching 220 million by September 2024.
Solana Leads the Surge in Active Addresses
The report identifies Solana (SOL) as a key driver of this user growth, with Solana accounting for 100 million active addresses, nearly half of the total. This indicates a growing preference for faster, newer blockchains. Meanwhile, Bitcoin (BTC) has 11 million active addresses, and Ethereum (ETH), the primary blockchain for decentralized applications (DApps), holds 6 million active addresses.
Mobile Wallet Adoption on the Rise
Mobile crypto wallet usage also hit record levels, with 29 million users in June 2024. While the United States still holds the largest share of mobile wallet users at 12%, the report notes that its dominance is fading as crypto adoption spreads globally. Countries like Nigeria, India, and Argentina are experiencing significant growth in mobile wallet use, reflecting the worldwide expansion of the crypto industry.
Global Crypto Users and Policymaker Interest
Despite the boom in active addresses, the report estimates that there are 30-60 million active crypto users, representing only 5-10% of the estimated 617 million crypto owners globally.
Policymakers are increasingly recognizing the potential of crypto. Notably, the listing of Bitcoin and Ether exchange-traded funds (ETFs) has signaled growing institutional acceptance. The European Union (E.U.) and the United Kingdom (U.K.) have taken proactive steps in shaping crypto regulations, with initiatives like the Markets in Crypto Assets (MiCA), outpacing efforts by the U.S. Securities and Exchange Commission (SEC).
Stablecoins and Their Rising Influence
Stablecoins have emerged as a critical tool for global payments, with their transaction volume surpassing that of Visa in Q2 2024—reaching $8.5 trillion, compared to Visa’s $3.9 trillion. Stablecoins are gaining attention in policy discussions, particularly in the U.S., where they are seen as a potential way to strengthen the U.S. dollar’s global standing as its dominance as a reserve currency declines.
DeFi’s Continued Expansion
Decentralized Finance (DeFi) continues to be one of the leading categories in crypto, attracting more developers and commanding significant daily usage. DeFi’s decentralized exchanges (DEXs) now account for 10% of spot crypto trading volume, traditionally dominated by centralized exchanges (CEXs). Additionally, $169 billion is currently locked in DeFi protocols, with staking and lending being the most popular services.
The report also highlighted Ethereum’s successful transition to proof-of-stake (PoS) in 2022, which reduced the network’s energy consumption and increased the percentage of staked Ether to 29%, thereby enhancing network security.
The report concludes by noting that DeFi represents a potential solution to the growing centralization in traditional finance, where an increasingly smaller number of large banks dominate the financial system.
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