Cryptocurrency usage has soared to unprecedented levels. According to a new report by venture capital giant Andreessen Horowitz, crypto adoption is showing no signs of slowing down.
The firm’s annual “State of Crypto” report, released 16 October 2024, indicates record-breaking engagement in the crypto space. This is driven largely by advancements in business and technological infrastructure.
The report estimates that the number of global cryptocurrency owners has hit a new high of 617 million this year. In fact, 30 to 60 million active users engaging regularly.
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220M Crypto Addresses Interacted With Blockchain In September
The report mentioned a surge in blockchain activity. It noted that over 220 million unique crypto addresses interacted with blockchain technology at least once in September alone. This figure represents a threefold increase compared to late 2023. Also, it emphasizes the growing integration of cryptocurrencies into various digital platforms and services.
a16z report: The use of digital currencies reached a new record
The investment
company Andreessen Horowitz (a16z) in its annual report announced an unprecedented record breaking in the use of digital currencies. The statistics show a significant jump: in September 2024, 220… pic.twitter.com/f0PFqqiX1J— Gems Mine (@Gems_Mine) October 16, 2024
The growth comes after a challenging period known as the “crypto winter,” which was intensified by the high-profile collapse of FTX. The exchange’s downfall was marked by the scandal surrounding its former CEO, Sam Bankman-Fried.
Despite these setbacks, the crypto market has shown a remarkable turnaround. Bitcoin, for instance, has seen its value skyrocket from $28,000 a year ago to a current high of $68,000, reflecting a significant 142% increase.
A key driver behind this growth has been the expanding adoption of stablecoins—cryptocurrencies pegged to traditional currencies like the US dollar. Stablecoins provide a level of predictability not commonly found in other digital currencies, making them more appealing for day-to-day transactions and as a reliable store of value.
This stability has prompted their use across multiple sectors, including remittances, e-commerce, and decentralized finance (DeFi) platforms, contributing to the overall rise in crypto activity.
The report specifically mentioned the cost reductions associated with executing crypto transactions as a contributing factor to stablecoin adoption.
For example, fees for using USDC, a US dollar-pegged stablecoin on the Ethereum network, have dropped dramatically from $12 to just $1. On Base, Coinbase’s popular platform for cryptocurrency transactions, sending USDC now costs less than a cent on average.
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Crypto Users Are Interested in AI
Interestingly, the report also finds a significant overlap between visitors to ChatGPT and users of top crypto websites. It suggests a strong connection between cryptocurrency enthusiasts and artificial intelligence (AI) users.
About one-third of crypto projects report leveraging AI technologies, the highest rate among all tech sectors monitored by Andreessen Horowitz.
However, the study cautions that AI’s growth could concentrate power in the hands of a few large tech firms with the resources to deploy advanced models.
Despite these concerns, the report offers an optimistic view, proposing that blockchain technology could play a role in addressing AI’s centralization risks.
By decentralizing data and processing power, blockchain networks could counterbalance the influence of major tech companies, fostering a fairer distribution of technological power.
“AI’s centralization-related challenges are almost exactly the inverse of the opportunities for decentralization presented by blockchain networks,” the report concludes.
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