The Office of the Comptroller of the Currency (OCC) has issued its 2nd letter , allowing US financial institutions to back digital dollar stablecoins under the leadership of Acting Comptroller Brian Brooks. This letter permits U.S. financial institutions to hold deposits as reserves for stablecoins that represent fiat currency such as the U.S. dollar. This isn’t the only thing that has enhanced the adoption of crypto currencies statistics show. To give you guys some context of what a stable pin is if you haven’t heard of one;
A stable coins refer to cryptocurrency backed by an asset such as a fiat currency, including U.S. dollars or other foreign currencies. Crypto traders quiet often tend to swap in and out of these stablecoins to Reduce the risk and volatility of other crypto currencies such as bitcoin and alt coins.
Brain brooks the leadership of (OCC) office of the comptroller of currency stated that national banks and federal savings associations currently engage in stablecoin related activities involving billions of dollars each day. The CEO and chairman of circle who is a issuer of USDC
(usd coin , one of the most used stablecoins as of today) commentary from the US Treasury’s Office of the Comptroller of the Currency (OCC) represents significant progress for the advancement of digital dollar stablecoins in the US financial system. The increase of USDC of have grown from 500million to 2billion as of September 13th. Do you see the trickling affect of digital assets creeping into financial infrastructures ? We now have stablecoin issuers resorting to putting their cash reserves that back their digital currency within national banks. The fact that banks are willing to hold stablecoin reserves shows the trustworthiness of stablecoins , and giving a sense of legitimacy to this space.
That’s great and all but what about the actual crypto space aside from stablecoins? Has this space continued to make strides in terms of adoption as well?
To gauge how much adoption is actually taking place with crypto currencies , we have to look at two metrics… 1st we have look at the growth of people owning crypto per year. Well how can we do this? As you guys know I always look back at history to give me clues of the future.
We must look at the historical data on growth in the number of people using crypto worldwide. How can we do this? Well if we look at how many users these larger exchanges have, we can gauge how many people out there at least have an account and accurately say this many people have interest in crypto if they have went through the hassle of opening up an account. Looking at Coinbase which is one of the largest exchanges out there, they have more then 30million users another one to look at is binance which has another another 12-15million and about 1-2 million daily active users according to Binance founder Changpeng Zhao. So, here we have roughly 40-45million users just on two exchanges. Like I said these are only the two most largest ones, we have several other similarly big exchanges, like Kraken, Bitstamp, Bitfinex, Bittrex, Huobi, and OKEx , which roughly is roughly estimated to have another 30million users. Just these house hold names combined bring in about 70-75 million users. But, this is leaving out many other smaller exchanges and estimates say including all exchanges we are looking at roughly 180 million users; now arguments can be made that some of these individuals have multiple accounts so staying in the ball park range of 70million seems to give us a better reading , this is a substantial gain from 2016 which only had roughly 8 million users in the second quarter.
Another way to see how much adoption this space has grabbed in the years is by looking at the number of crypto wallets that are out there. As of q3 2020 there are 54.27 million wallets whereas in q4 2017 when we had that massive bull market we only had 21.5million wallets , this is over a 100% gain in wallets created.
https://www.statista.com/statistics/647374/worldwide-blockchain-wallet-users
So bringing this all together now we have banks essentially backing digital stablecoins by holding them in their reserves, growth in the amount of users for crypto’s , and last but not least massive growth in the number of wallets that have been created. I only see this space strengthening in the years coming, and price is now reflecting this. Now that we have digital assets creeping into the financial system, I couldn’t be more excited about this space and I hope you guys are as well.
Let me know what you guys think of stablecoins entering our banking system and the growth of the crypto space id love to hear your thoughts on this matter.