Bitcoin active address count hits all-time high, but how big this number really is?

Hello my fellow bloggers! Recently Bitcoin reclaimed its 2017 positions in the number of addresses with a non-zero balance. Today I will try to show how far from mass adoption we really are despite of this.

Let’s start with the chart showing the number of addresses with a non-zero balance. I’m taking this chart instead of total number of addresses or active addresses because we want to know how many people actually own BTC.

You can see the spike we had back in 2017. This was the time when hype around Bitcoin was so big, people were FOMO-ing into BTC even without actual understanding of what it really is. In 2021 we have reached the same number of addresses with BTC. Can we take it as a number of people having Bitcoin? It is hard to say. On the one hand, a person can have multiple BTC addresses (even non-zero ones), on the other hand, some Bitcoin owners don’t have a wallet at all. All their BTC is on exchange or in trust like Graysacale. I don’t think anyone can really count the number of users based on these assumption. For simplicity, let’s agree this value represents the number of users.

According to the chart we have 28.6m actual Bitcoin owners. The question is, what this number means? Is it just the beginning and we are still among the first BTC adopters? Or are we are close to mass adoption already? To make judgement, we need to compare BTC to something of the same scale. I believe the best analogy would be Internet itself. See the table below that shows early years of the internet:

As you can see, Internet started from 16 million user in 1995 and grew up to 513 million users in 2001. On the first look it seems we are somewhere between 1995 and 1996 with 28.6m users. Yet we need to consider human population growth. In 1995 population was below 6 billion people. In 2021 we are closing to 8 million people. In 1995 0.4% of human population used internet, in 2021 0.37% of human population use Bitcoin. In other words, we are still at the very beginning. We are not late for the party, the party hasn’t even started. Keep calm and HODL Bitcoin!