According to a report by OKLink, the number of Bitcoin wallets with a positive balance has recently hit an all-time high.
Bitcoin wallets continue surging
OKLink, the research arm of the cryptocurrency exchange OKEx, found in a recent report that as of November 24, the number of Bitcoin wallets stood at 39.41 million. That implies a year-to-date increase in Bitcoin wallets of 20%. Although currently not reflected by prices, that is actually a bullish indicator for Bitcoin, as investors speculate on a surge in Bitcoin prices despite its recent fall from all-time highs of almost $100,000 AUD. Most interestingly, the number of Bitcoin wallets rose, although one is wondering whether wallets are driving prices or if it is in fact the other way round.
Bitcoin wallets in other countries
Although the report, for obvious reasons, could not specify the location of Bitcoin wallets, numbers have been surging across several countries. For example, according to government sources, in El Salvador, which famously adopted Bitcoin as a legal tender in 2021, 50 percent of the population are using the cryptocurrency.
That points to wider mainstream acceptance of Bitcoin as a means of payment, which also would indicate more price upside in the future, if not in the short term, then at least in the long run. Wider usage of the Bitcoin network as a settlement layer for payments increases the appeal for investors to get involved in Bitcoin, as price downside gets limited by ever-increasing demand for the network.
Bitcoin price targets
For example, Cathie Wood declared in an especially bullish take that she expected Bitcoin to reach $700,000 AUD in the next five years, which would mark more than a sevenfold increase from price levels in November 2021. While that is certainly not out of the question, it would require mainstream adoption far beyond cultural significance, where Bitcoin currently finds itself.
However, increasing the number of Bitcoin transactions by a factor of seven may very well be possible in the coming years, especially if Bitcoin manages to pull off scaling solutions like the Lightning Network. With countries like El Salvador providing a real-world petri dish for the usage of the Bitcoin network as a settlement layer for payments, that could be the decisive driver to extremely bullish price targets until the end of the decade.
Bitcoin no longer a crime coin
Finally, the increase in Bitcoin wallets also points to the fact that the currency has moved on from its status of drug money and tax evasion currency, thereby dismantling the Bitcoin is a crime coin narrative that critics like to resort to. While Bitcoin is definitely not yet at the stage where it can support the settlement of daily payments on a large scale, it has come a remarkably long way in little more than a decade.
It will be interesting to see how the number of Bitcoin wallets develops into 2022 and if the recent surge was only a bull market phenomenon or a fundamental shift in investors’ perceptions.