50,000 A Day? Coinbase Sees Influx Of Crypto Adoption In 2017

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Coinbase CEO Brian Armstrong claimed that Coinbase had an average of 50,000 new accounts per day during 2017. Last year’s record-high cryptocurrency prices are likely to have been a factor, as Bitcoin’s ATH of $20,089 in December would have inspired people who previously never considered investing in cryptocurrencies to at least look at major exchanges like Coinbase.

Coinbase claims that trading activity on its platform reached a volume of $150 billion over the past year. Most of the newcomers to cryptocurrency investment are unlikely to have made a profit, however. Bitcoin has fallen about 70% since last December and most cryptocurrencies are currently in the red.

“This technology is going through a series of bubbles and corrections, and each time it does that, it’s at a new plateau. People’s expectations are all over the map,” Armstrong said at San Francisco’s Bloomberg Players Technology Summit last Tuesday.

Cryptocurrency Adoption on the Rise

Although Armstrong mentioned that real-world adoption is also up, he also dismissed the now-debunked report that Starbucks would start accepting Bitcoin: “I think it will be quite some time before you cross the street to Starbucks in the U.S. and pay with crypto.”

On the flip side, it is possible to buy gift cards with Bitcoin and Bitcoin Cash, which could amount to the same thing for most “average” users who are interested in using cryptocurrencies in their everyday lives. The use of payment processors such as Coinbase Commerce, BitPay, and Coinpayments are on the rise.

As cryptocurrency payments become more “user-friendly”, consumers who are already familiar with mobile payment options and worry about hackers stealing their private financial data from corporate servers may choose to ditch the use of credit and debit cards in favor of cryptocurrency wallets on their Android phones.

What will increased adoption mean for Bitcoin price? Most likely, people will see insiders using top cryptocurrencies like Bitcoin and Litecoin in their daily lives and wonder how they can get in on it, too. Most people who can get a decent selfie with their photo IDs will probably check out exchanges like Coinbase first. Others may reasonably ask how they can avoid the exchange fees and find ways to earn and spend cryptocurrencies on their own. Either method will increase demand for cryptocurrencies, which can and will drive up the price.

Coinbase “Empire” May Concern Some Cryptocurrency Insiders

Coinbase’s claim of 50,000 new accounts a day in 2017, plus recent acquisitions, has caused concern that the company is building an empire similar to Google’s search engine or YouTube’s video hosting platform: Sure, alternatives exist, but they are not used as much and some people may not even realize what viable choices they even have.

This, combined with Wall Street’s caution, has led to Coinbase gaining a position that some analysts call “unassailable”. Sanford C. Bernstein & Co., for instance, believes that Coinbase already has a 50% market share by volume between its brokerage and professional exchange platforms. Even the largest players on Wall Street may not be able to make a serious dent in Coinbase’s market share if Wall Street does not throw off some of its cautions and move more swiftly to bring alternatives to market.

This may not entirely be a bad thing if cryptocurrency insiders recognize Coinbase’s market dominance for what it is and don’t try to pretend that exchanges and new investment options are the entire point. Many cooler heads recognize the SEC’s rejection of the Gemini ETF as an opportunity to “buy the dip”, for instance. Other influencers like Roger Ver have not yet given up on the idea that some form of cryptocurrency could be used as “the people’s payment method” instead of a pure “digital gold” type investment, which would reduce the intense focus on exchanges.

Armstrong may not be exaggerating when he says Coinbase got 50,000 signups a day last year, though it may be questionable how many owners of those new accounts are still interested in buying Bitcoin now that it has fallen so far from its all-time high. Many of them may simply have been checking out a major exchange, if not entirely in FOMO mode, while Bitcoin still had a five-digit dollar value.

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