Weiss Crypto Ratings says despite the 2018 bear market, there was a considerable uptick in the usage of altcoins. The rating agency says this trend points to the increasing level of cryptocurrency adoption for many users across the globe.
Cryptocurrency Sees Transactions Soar in 2018
According to a blog post published by the agency on Wednesday (April 10, 2019), four altcoin projects saw massive growth in user adoption throughout 2018. Meanwhile, at the time, market prices were plummeting by an average of 80 percent across the board.
EOS transaction volume grew from 7,000 per day to about 4.6 million per day between February 2018 and March 2019. Tron, also saw its own count increase from 3,000 to 1.9 million during the same period.
The other two cryptocurrency projects identified by Weiss Ratings – BitShares and WAX, saw their numbers grow to 1.1 million and 4.4 million transactions per day, respectively.
In total, these four altcoin projects experienced a 2,700 percent increase in daily transaction count, growing from 433,000 transactions in February 2018 to more than 12.4 million as at March 2019.
According to Weiss Ratings, this increased adoption in the face of bear market conditions parallels the trend observed during the dot-com era. The agency expects that developments in the technology will lead to a greater cryptocurrency adoption in the near future.
Not All Transactions Are Equal
However, it is important to note that high transaction count doesn’t necessarily equate to meaningful value transfer. Moreover, transacting on the aforementioned top-four blockchains, in particular, costs very little. Therefore, it may be a poor metric to gauge mass adoption as most of this activity may not actually be economic in nature and/or performed by real users.
EOS’s daily transaction count, for example, outstrips Bitcoin by as much as 14 times. However, Bitcoin value transferred dwarfs every other existing blockchain.
Earlier this week, cryptocurrency analyst Ceteris Paribus highlighted that Bitcoin processes 20 times more USD transactions than EOS despite having only about seven percent of the latter’s transaction count.
Additionally, Bitcoin’s metrics do not include second-layer transactions via the Lightning Network.
Transaction counts get a lot of hype, but what kind of value is actually being moved on chain?
Bitcoin processes <7% the amount of daily transactions as EOS yet moves 20x the USD. pic.twitter.com/dgGHgE4rKQ
— Ceteris Paribus (@ceterispar1bus) April 10, 2019
Weiss Ratings does acknowledge this fact, saying:
Of course, not all transactions are qualitatively the same. A $10 million Bitcoin transfer is obviously more important than a simple vote or ‘like’ on Steem.
According to Weiss Ratings, other essential metrics like security, network capacity, and developer activity have also increased over the last 12 months. Coupled with the lower prices, the agency believes that altcoins are on their way to gaining greater traction in the finance and technology industries.
As reported by Bitcoinist, an online Twitter poll by the International Monetary Fund (IMF) revealed that many people Bitcoin and other cryptos will become mainstream within the next five years.
What are your earliest forecast for Bitcoin and other cryptos becoming mainstream? Share your thoughts with us in the comments below.
Images via Weiss Crypto Ratings and Twitter (@ceterispar1bus)