Global cryptocurrency adoption is approaching a significant milestone, with 7.51% of the world’s population now using digital currencies, according to a report by MatrixPort.
The report projects this figure to exceed 8% by 2025, signaling a potential shift of crypto from a niche market into mainstream financial systems.
The report highlights the growing influence of institutional involvement, which is a key factor driving the steady increase in adoption.
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Institutional impact on global adoption
The report cites the rise in institutional interest as one of the key factors accelerating crypto adoption.
Financial firms like BlackRock have been pivotal in building trust and legitimacy for digital assets within traditional financial systems.
Markus Thielen, founder of 10x Research, spoke to Cointelegraph about the role of institutional products in the growth of Bitcoin (BTC) and the broader crypto market:
“The evolution of Bitcoin has consistently driven price rallies whenever new layers of Bitcoin acquisition were introduced to financial markets [...] The potential introduction of options based on Bitcoin spot ETFs could trigger another wave of institutional interest.”
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Bitcoin’s role in economic uncertainty
Bitcoin plays a central role in overall cryptocurrency adoption, often viewed as a store of value, particularly during periods of economic uncertainty.
Thielen noted that economic challenges have historically increased demand for Bitcoin, such as during the European debt crisis and the devaluation of the Chinese yuan.
Thielen added:
“[...] rising US debt levels could spark strong demand for Bitcoin if the economy faces a slowdown, whether from a recessionary period or trade wars. This trend positions Bitcoin as a hedge during times of economic uncertainty.”
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Challenges to crypto adoption
Despite the optimistic projections highlighted in the MatrixPort report, several hurdles remain, including regulatory considerations, market volatility and retail investor security concerns.
Hacks and scams, such as wallet drainers, still pose a threat in the crypto space. Additionally, institutional investors could exacerbate market volatility, with large sell-offs potentially destabilizing the market during macroeconomic shifts.
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