Is Bitcoin growing fast? One new potential user is added every 2.5 seconds, while the world population increases by 6.25 people.

As a brand new financial concept, Bitcoin has been around for over 11 years. There is no doubt that its growth rate since its launch has been quite impressive, but is this growth really as fast as those of us “insiders” think?

(Changes in the number of Bitcoin wallets from its birth to the present)

Recently, Bitcoin has reached another milestone. This time it is not the price, but the number of wallets. Data shows that by mid-June 2020, the number of Bitcoin wallets exceeded 50 million.

At first glance, this volume seems quite large, but if we compare it, your perception may be overturned.

50 million wallets, which means 0.64% of the world’s population is using Bitcoin, or to put it another way, 99.36% of the world’s population does not have Bitcoin.

Of course, many people have more than one address, so the actual percentage is much lower. Based on analysis reports from previous years, known trend changes, and personal intuition, I guess the actual percentage is closer to 0.23%.

In the 11 years since Bitcoin was launched, regulatory laws in many countries remain unclear, and the total market value of cryptocurrencies is less than a quarter of the market value of the world's largest companies, let alone compared to fiat currencies.

So, what conclusions can we draw based on these known data?

The most straightforward view is this: we are either on the verge of a surge in usage, penetration, and prices, or the entire monetary experiment fails and the world moves on.

Between these two extremes, is it possible to find a middle ground?

1. “Imminent” growth

There are two consensuses among Bitcoin holders: first, they bought too late, and second, they bought too little.

As for me, the first time I saw Bitcoin was in 2014 when I read a random article in a newspaper. At that time, I had no idea what it meant and even misread "Bitcoin" as "Britcoin".

In 2016, I started to study it seriously, started to invest in early 2017, and in early 2018, I devoted myself to this emerging industry that grew up around a brand new concept. At that time, I thought it was something bigger than the Internet.

The reason for this is that during this period, people felt that the global adoption of cryptocurrencies was imminent, especially during the buying frenzy in late 2017.

Everybody is starting to pick up on it, and it’s going mainstream. That’s what everybody is saying.

However, “everyone” was wrong.

2. Does the growth of wallets mean major development?

Even though Bitcoin has not yet achieved "global adoption," tens of millions of people already use it, and many of those surveyed said they plan to use it in the future.

While we can’t directly equate new wallet addresses with new users, we can still use the wallet creation rate to gauge Bitcoin’s overall growth. Let’s take a closer look at this data.

The blockchain data is very comprehensive. We can determine the exact number of addresses on any date, and then calculate the growth rate by comparing the data on different dates.

For example, in March 2017, the day I bought Bitcoin, 12,656,618 wallets had been created. At the time of writing this article, there are 50,166,790 wallets, an increase of 37,510,172. Clearly, something must have happened.

The data shows that not only has the number of new wallets increased, but also the rate at which new wallets are created has increased.

A total of 10,377,248 new wallets were created throughout 2018, an average of 28,509 per day and more than 20 per minute.

In 2019, that number rose to 12,804,514, an increase of 35,177 per day, or 24 per minute, about 23% faster than in 2018.

That is to say, if you spend 2 hours and 12 minutes watching this year's Oscar-winning movie "Parasite", by the time you finish watching it, 3,168 new wallets will have been created.

While it’s common for people to have multiple wallets for a variety of reasons, we can rule out overzealous hardcore Bitcoin enthusiasts creating these wallets for themselves.

No matter which way you cut the numbers, the number of nodes accessing the Bitcoin network is increasing.

At this rate, Bitcoin will reach the milestone of 1 billion wallets around January 2023, provided that the registration rate does not increase further, otherwise the time will be much earlier.

3. Think calmly: Is this speed fast?

It’s easy to feel good about yourself; after all, having a (potential) Bitcoin user every 2.5 seconds is impressive.

However, the global population is currently growing at a rate of about 150 people per minute in 2020. Calculating, in these 2.5 seconds, when 1 new Bitcoin user is generated, the world population increases by 6.25 people, which means that the percentage of the global population currently using Bitcoin is decreasing.

Of course, any application, any invention, starts from scratch. Take Facebook, for example. No one used it 20 years ago, but now it has 1.69 billion users, almost 22% of the entire earth's population. Other social networking software has shown similar growth figures, but Bitcoin has not yet.

Maybe that’s not a fair comparison. It can be argued that these Web 3 applications fully address latent needs while the technology is enabled and are well funded and have network effects that allow them to grow tremendously.

I recently downloaded a software called BlueStacks on my computer. It was designed for only one purpose - to allow Android applications to be used on the computer. However, when the screen opened, a set of data shocked me. The software said: 100,000 people download BlueStacks every day.

Yet, I had never heard of it before, and the app was downloaded nearly 70 times a minute, with a total of over 400 million downloads— more than four times the entire Bitcoin community, and the software itself is two years younger than Bitcoin.

So the desire to use Android apps on a computer seems to outweigh the desire to use a whole new form of currency by a 4:1 ratio . That does give people a new perspective, doesn’t it?

4. Bitcoin is different

So does this mean Bitcoin is doomed, even though roughly 168 wallets have been created in the time it takes you to read this?

Well, if you compare it to other software downloads, it does look bleak, but it’s not a fair comparison.

Most of these applications are built on existing, well-developed infrastructure, with huge amounts of funding from private companies who spend a lot of money advertising these products. They solve problems that we often overlook, and grow exponentially over time due to network effects.

On the other hand, Bitcoin is an open source invention that was invented simply to solve the problem of "scarce digital money" - most people don't even know the term exists or why it matters. Bitcoin has no funding, no big institutions, no advertising, no organization or formal training other than those who already use it, and even requires the establishment of a whole new "mining" network.

Even though the existing financial system is a bit messy, almost everyone uses it because they really believe it is the only option.

Bitcoin works in some less developed countries, but in developed countries it is seen as a second-rate alternative that will be meaningless unless the system people are used to completely collapses.

Finally, there is one fact we cannot ignore - some people and institutions do not want Bitcoin to succeed and often use the media to find out information that it cannot be used.

Yet, despite these headwinds, Bitcoin is still growing. Yes, it may only be around 100,000 people a week — a drop in the ocean by comparison — but we can draw two conclusions from this:

First, the total demand for Bitcoin, and the resulting transactions, will grow as the number of wallets grows. The so-called "Bitcoin will die" claim is unfounded.

Second, as time goes by, as the total number of users increases, the chances of network effects appearing will also increase. This will be especially true as the barriers to entry for traditional groups continue to be optimized.

In short, Bitcoin will go further than it is now.

Many of us, myself included, underestimated the scale of this transformational alternative to traditional finance. We often compare it to the early days of the internet, but in reality, it may be much bigger than that. If you are still in the "too little, too late" camp at this point, this knowledge will also give you peace of mind, because this ship has not really sailed yet.