Bitcoin’s price jump and a massive increase in DeFi played an important role in global adoption.
Cryptocurrency adoption has surged in recent months as the total number of global crypto users jumped above 106 million for the first time in January 2021. The recent jump in the prices of digital assets played a key role in the adoption.
According to a report published by Crypto.com, the global cryptocurrency population jumped by 15.7% in January 2021 due to strong demand for Bitcoin and huge growth in the DeFi sector. The user deposit rate and on-chain activity of the world’s largest cryptocurrency have surged to a record high.
“Likely events that drove crypto adoption were the huge growth of DeFi last summer, PayPal’s opening up crypto services, and massive institutional adoption and facilitation of cryptocurrencies. In the latter half of 2020, we have seen accelerated adoption growth due to some remarkable events: the rise of DeFi in the summer, PayPal’s opening on crypto purchase for the US users in November, and institutional adoption in December (e.g., Grayscale, MicroStrategy),” Crypto.com mentioned in the report.
Crypto.com announced earlier this week that it has crossed the milestone of 10 million users, a growth of 100% in the last 4 months.
The cryptocurrency market is on the rise since the start of 2021. The total market cap of digital assets jumped from $750 billion to as high as $1.75 trillion within the last 7 weeks. Bitcoin, the world’s largest cryptocurrency jumped above $58,000 on Saturday after the market cap of BTC crossed $1 trillion. Additionally, Ethereum registered an all-time high of $2,026 earlier this week.
The recent boom in the adoption of digital assets is mainly due to the involvement of institutional investors. MicroStrategy, Grayscale, and Square accumulated more than $2 billion worth of Bitcoin in the last 7 days.
Despite the regulatory uncertainty, the cryptocurrency population is growing at a rapid pace. New retail and institutional investors are entering the market to take advantage of the significant price growth in digital assets.