How many people touched Bitcoin up to 2017 and what is the current adoption pace?

in bitcoin •  last year

While thinking about Bitcoin value one must ask what is the real Bitcoin adoption. This is hard to calculate but let's try to elaborate a bit:

Target population

World population is currently about 7.5 billion of people so we have maximum physical limit. It would be nice if all of them were Bitcoin users but it's not possible for multiple reason, let's expand it more.

Let's find some target group for potential Bitcoin users. First we cut some age groups. It might be a bit discriminatory but it's for modeling purpose.

  1. Let's cut people 0-14 years
  2. Let's cut people 65 and more

Furthermore, we cannot take all population as the base but only people with internet connection and we will get 3.7 billion people as our base. Now cut mentioned age groups, 0-14 and 55 and above, and we will have remaining 57% of population and it makes 2.1 billion people who are our target group for Bitcoin adoption (people with internet and proper age).

Bitcoin network

Now let's take a look at Bitcoin network. There are 11,511,004 addresses with balance greater than 1$. Many users might occupy multiple addresses so actually user count might be even 10 times smaller.

Current adoption

Current projected Bitcoin adoption is between 1 million to 10 million users

Ok, let's assume there are 10 millions users. Then bitcoin addoption among target user group is about 0.46%. If number of users is only 1 milion users then Bitcoin adoption is about 0.046%. It's highly probable real state is somewhere between these numbers. In summary current Bitcoin adoption is between 0.046% - 0.46% of target population.

Price after partial and full adoption

So we have approximate Bitcoin adoption about 0.46%, resp 0.046 % in target population. With this calculated adoption, real Bitcoin price is current price - about 1800 USD.

What price we can see if there is 10% or even 100% adoption and price grows linearly (which is quite reasonable expectation). Here is the projection

  • 0.46, resp. 0.046% is real 2017 adoption... with current price 1800 USD
  • 10% Bitcoin adoption..... 1 BTC should be around 39,000 USD, resp. 390,000 USD
  • 100% Bitcoin adoption.... 1 BTC should be around 390,000 USD, resp. 3.9 million USD

So when you (in few years) see prices like these, don't be that surprised, it's just math while Bitcoin is gaining major adoption. And when you hear someone predicting these insane numbers, well, that person not be that insane. And these projections are very conservative because even many younger people are adopting technologies and also Internet coverage is increasing in time and these calculations ignore those positive fact.

Adoption pace

Adoption pace is also hard to determine except some approximation based on wallet counts and price. Wallet count is about 10x compare to 3 years ago and price is about twice. Based on that we can estimate 5x growth of user-base in 3 years. Based on this, next year Bitcoin (and crypto in general) can reach adoption about 1% of target population. It's also worth to mention that current price is undervalued to adoption pace or another explanation might be that three years ago we had big price bubble which is also possible. However with current adoption pace it will take about 5 years until 10% of target population adopts Bitcoin and then next 2 years until full adoption, so it's 7 years to full adoption. It might take less due to various factors but I doubt it will be be slower than 7 years from now.

Conclusion

To finish this article without counting, I'll give you two most crypto regret quotation I've heard many time through last years:

First is so-called "saver quotation":

I regret I didn't buy when price was XYZ

And the second common regret is so-called "weak-hands quotation":

I regret I already sold for XYZ price

I can tell you I've heard these regrets through all range of prices every year

One thing is sure , don't worry about volatility that much, even in 2017 you're still among early adopters and maybe even among innovators. Things is, no matter when you join, you will always somehow profit if the project will not crash completely. But earlier you join, greater your profit might be and also greater your risk as well as we all here are still Bitcoin pioneers. Ok, that's all. May God give us fair monatery system and bless our investment decisions!

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Here I went over all of this few weeks ago, and I really explained how at one to a few million current active users worldwide, we could make the price go from $1000(a few weeks ago) to $ 1 million if we have a 1000 percent increase in users which can happen when we go from the 1 million current active users to a full saturation of the 4 billion total internet users out of the 7 billion total humans....and out of that over 4 billion are online and around 3 and a half billion have smartphones with the ability to use a bitcoin wallet..and there are over fifty billion smartphones out there so theres enough for everyone, including the 700 million people in poverty who go to bed hungry everynight, we can give them all a smartphone too, and send em steller and ripple, which will go up one ay, we can help end poverty with bitcoinand altcoins

and we can be SURE that the prce will continue to climb ! Why would it not People are ust beginning to find real uses for bitcoin.. people are JUST THIS YEAR figuring out how much money it can save them!

WE ARE THE GUINNEI pigs! The corporate and banking world is watching this little subculture of internet people all thriving right now and they will wanna help join the party and with real massive investments coming in, we will see even people buying bitcoin past 2000 will be able to make a profit when bitcoin goes to $4,000 and everyone who bought at $1000 will feel the magic of making 4 times their proit while everyone who buys now even to 2000 will also feel the magic of having double their money! And then people wgo buy at $4000 will STILL benefit when the price goes all the way to $40,000 and there it will stay...untill it crashed five thousand dollars at a time doown to 35,000 but then people will buy it and back it will go to 40,000 and oh while this is happening altcoins will al be going so high so just buy as MANy as you can now before youwont be able to!

And buy as many mining contracts as you can afford! Mining will only become more and more profitable as bitcoins price goes up to $4,000 by the end of this year and who knows maybe it will actually reach 40,000 by the end of this year!

I dont think anyone really eexpected 2017 to be so sucesful for bitcoin ad altcoins even more so, this bull market just keeps going as if its reflecting how bitcoin rose 1 million percent in value, altcoins have a long way up and so does bitcoin!

https://steemit.com/bitcoin/@ackza/bitcoin-to-reach-1-million-dollars-inevitable-finite-amount-only-1-million-users-globally-right-now-3-4-billion-internet-users
and this
https://steemit.com/bitcoin/@ackza/there-will-only-ever-be-21-million-bitcoins-why-and-how-bitcoin-and-all-cryptos-are-going-up-forever-and-why-people-need-alt

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Yes, the models look very optimistic although there is always some risk involved as always something can go wrong. Still, now risk is much better distributed than in 2013/2014. So yeah, question now is not if but when it becomes mainstream. Another interesting thing is that even though it looks a bit like pozi scheem due to doubling prices, etc., even last adopters will not be robbed. Adoption curve is not speaking about price decline but only about, well, adoption. Good thing is that even last adopters will loose nothing except big investment/risk opportunity. Real looser might be financial institutions that will not adapt, but I don't think they are that stupid and I guess they are already slowly buying. Right now I'm really wondering if it goes smoothly up or if there will be some big shocks. I would be surprised if old system accepts this shift of paradigm without serious fight. Major elites always fought for control over money supply. They might like Ripple because it only increase their profits and doesn't take power from them but they still hates Bitcoin and most of alt crypto projects.

I think bitcoin is already near peak adoption. It is because there are so many competing cryptos on the market. I have never bought bitcoin but I have 3 crypto currencies including steem. The reason bitcoin was so great was because it was liquid, a feature now shared by many others.
If you look at market capitalization bitcoin is losing marketcap steadily to other cryptos. Nevertheless, the supply demand fundamentals should keep the bitcoin price high measured in USD for the foreseeable future.

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If you think Bitcoin is near peak adoption then it's very unsuccessful project as it didn't reach even 1% of target population although it's aimed to 200x more. And the alts...no way, Bitcoin has currently about 50% crypto market capitalization. Anyway Feel free to cut all price projections to one half and if you expect Bitcoin going to lower market share (like 10% or so), you can cut number by 10. Still you will get tens of thousands USD per Bitcoin for full adoption. Look at Steem, alt with one of the greatest user base - but it's still only ~150,000 people at most. Target group is about 2 billion users similar to Facebook users. So adoption now is still very low and everyone here is early adopter at best. This is just a beginning for all crypto projects, Bitcoin included. It can take years to take it to mainstream.

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Due to the fast pace of technology I think 10 years is more than enough time for technology to reach the middle of its product life cycle. Bitcoin was successful in that it opened the door for other crytpocurrencies. The iphone 1 was very successful but the pace of technology and competition made it obsolete within a year or two. If you are talking about cryptocurrency as a group then I agree we havent even seen the beginning of adoption yet. But just as the iphone1 was relegated to the dustbin of history I think bitcoin will be too within 20 years but there is no doubt that supply and demand will support its price and purchasing power.

I agree with you that bitcoin has the potential to go much higher but its growth and adaption will certainly be affected by other coins. Actually, steem was the first cryptocurrency I ever owned. Bitcoin has no platform like steem to generate demand. Just being a currency is no longer an advantage as other currencies offer specific advantages besides just facilitating transactions.

Thanks for your reply and I believe there is a lot of logic in what you are saying. The global market is big enough for a huge growth in bitcoin as well as other currencies.
Also keep in mind that the reason Facebook has so many users is because it is a CIA project (inqtel) with government backing. In contrast, Bitcoin and other cryptos have are the enemies of the central bank controlled governments.

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It depends. For example first household workstation was available in 1974 and when it become mainstream? Around 90's. Also during some phases there is slower adoption, during another faster. Yes, adoption is still very low. Your example with iPhone is valid for hardware but not for software, Bitcoin is evolving in time and when SigWit is enabled, it will move forward a lot. So it might never be obsolete. Of course there will be some more agile projects as Steem and another. Bitcoin might have only 10% market share in few years. But it's good we have so many crypto projects, it will move all the sector forward a lot.

Bitcon, same as Steem has actually lot of demand factors but not for everyone, as Steem is also not useful for everyone. Currently Bitcoin has lower inflation that Steem, therefore is better to store value, with Bitcoin you can directly utilize many interesting services like purse.io, gyft to buy things for better price, utilize jobs services, etc., with Bitcoin you can invest and fund thousands of projects, with Bitcoin you can easily access any alt market. So although it has no integrated platform inside, there are multiple useful services and utilizations primarily built around Bitcoin.

You are right, old world with most of its elites doesn't like crypto and Bitcoin because it's disrupting world system which was and still is source of their profit and power. They tried FUD and repression first, during next phase they might try to buy it all and manipulate (like gold and silver), who knows. But it will be hard for them. Once it's manipulated, community can build another project that is not owned by them and move on there.

Nice analysis . I am now following. How fast have wallets grown I imagine wallets per person would be somewhat stable.

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Thanks. Wallet numbers are growing about 2.5x per year to 13 millions of wallet. Conservative estimation our real users might be about 7-10 million users I guess. But it's better to put it low because there might be users who try it, leave and not return. All of this affects demand. If 1/2 of these users stays active in ecosystem, then it's still growth 70% per year which seems to me as realistic. It's not my goal to calculate precise number (IMHO it's not even possible), but rather to calculate some ranges in which all of this is moving and identify possible underpricing or bubble and to show whether there is still space to grow or not.

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wow you messages of hope are INCREDIBLE yes i agree 100 percent thi is just teh beginning and steemit is geared to take on facebooks 2 billion userbase and we can even create a blockchain replacement for google !

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An important thing to remember is that many wallets generate a new address with every transaction. There are exponentially more addresses out there than there are users. Adoption has so much room to grow! It is unfathomable how valuable bitcoin will be in a couple of years even. It finally hit $6k usd. Just a few short months after this post.

Are you running a node?