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Crypto adoption rose sharply over entire 2022 despite crashing markets – Report

Crypto adoption rose sharply over entire 2022 despite crashing markets - Report

Despite 2022 being a rough period for many participants in the cryptocurrency market, be it in terms of prices, bankruptcies, high-profile arrests, or legal proceedings, the adoption of crypto nonetheless continued to increase, rising sharply throughout the year.

As it happens, the total number of global crypto owners grew by 39% in 2022, increasing from 306 million in January 2022 to 425 million in December of the same year, according to the new research report published by Crypto.com on January 19.

Total number of crypto owners in millions. Source: Crypto.com

Ethereum leading the charge

Specifically, the most impressive gains in adoption were recorded by Ethereum (ETH), which increased the number of its holders by a whopping 263% throughout the year, starting at 24 million in January and ending up at 87 million in December, accounting for 20% of global crypto owners.

As for the reasons behind the accelerated adoption rate of Ethereum, the report singles out the anticipation and execution of The Merge as the main catalyst, referring to the network upgrade that marked its transition from the Proof-of-Work (PoW) to the Proof-of-Stake (PoS) consensus algorithm, and that was completed in September. 

In addition to the Merge, the report states that interest from institutional investors, the momentum of non-fungible tokens (NFTs), and the popularity of ETH liquid staking also contributed to Ethereum’s high adoption rate. With the announced release of staked ETH in March 2023, it is likely that this interest will grow further.

Number and growth rate of Ethereum owners. Source: Crypto.com

At the same time, Bitcoin (BTC) recorded less impressive results than Ethereum in 2022, but an increase nevertheless, as the number of Bitcoin owners grew by 20% – from 183 million in January to 219 million by year’s end – as it accounted for more than half (52%) of global crypto owners.

Bitcoin’s adoption rate growth was likely bolstered by the Central African Republic (CAR) becoming the second country after El Salvador to adopt BTC as legal tender, as well as Goldman Sachs (NYSE: GS) offering its first BTC-backed loan.

Ethereum, Bitcoin price analysis

Indeed, both Ethereum and Bitcoin had a tough year in terms of their prices, as ETH dropped over 68% and BTC 65% during 2022. A brief bullish rally after 2023 started was cut short by the announced bankruptcy of crypto lender Genesis.

At press time, both assets are recording declines on their daily charts, as ETH lost 4.08% on the day, currently trading at $1,517, while Bitcoin is down 2.74% across the past 24 hours, at press time changing hands at the price of $20,707.

Ethereum 1-year price chart. Source: Finbold

Interestingly, Ethereum had a better performance than the flagship decentralized finance (DeFi) asset in the second half of 2022, registering a return of 22.4%, while BTC had a return of -10.8%, as Finbold reported in December.

Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk. 

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