Bitcoin on the Same Adoption S-Curve As the Internet — Some Thoughts and Figures | by Sylvain Saurel | Feb, 2022

BITCOIN | INTERNET | ADOPTION

Bitcoin is a pseudonymous network where each user can have from 1 to n addresses. It is impossible to know the exact number of Bitcoin users at any given time. We can, however, get a good idea of the number of active addresses on the network. Based on this number, some companies specializing in the on-chain analysis have estimated that the number of Bitcoin users is currently around 130 million.

Bitcoin is often compared to the Internet in terms of its adoption curve. An adoption S-curve is generally divided into 5 phases:

• Innovators
• Early Adopters
• Early Majority
• Late Majority
• Laggards

In September 2020, Bitcoin passed the 100 million user mark. At the time of writing, the estimated 130 million users puts Bitcoin on par with Internet adoption in absolute numbers between 1997 and 1998.

It is no coincidence that many are now beginning to imagine Bitcoin’s adoption growing at the same rate as the Internet. Wells Fargo, for example, has just published a report at the beginning of February 2022 in which the parallel between the adoption of cryptocurrencies and the Internet is made.

Wells Fargo explains that the cryptocurrency world is currently comparable to that of the Internet in the second half of the 90s. At that time, the Internet had experienced a significant acceleration in the number of users from 130 million users between late 1997 and early 1998 to 1 billion users by the end of 2005.

I have put the adoption figures for the Internet into perspective with the potential figures for Bitcoin in the years to come if the comparison remains relevant:

This clearly shows the next steps for Bitcoin if it continues to keep pace with the growth of the Internet:

• 1 billion users in 2030.
• 2 billion users in 2035.
• 3 billion users in 2038.
• 4 billion users in 2041.
• 5 billion users in 2045.

The number of Internet users is currently around 5.2 billion, or a little over 65% of the world’s population.

It is no coincidence that Michael J. Saylor often quotes this figure of 1 billion users for Bitcoin in 2030. This figure does not come out of nowhere. Michael J. Saylor also did the analysis I did here. If Bitcoin were to reach that 1 billion user mark by the end of the decade, it is more than likely that its market cap would have equaled that of gold which is currently $11.6T.

The superiority of Bitcoin’s monetary policy lies in the fact that it is programmatic. Thus, we can already know roughly how many BTC will be in circulation in 2030. By that time, the annual inflation in the supply of new BTC units will be 0.4% and 98.02% of all Bitcoin should have been put into circulation. This gives us a figure of around 20.585 million units of BTC in circulation.

From this assumption, we would have a Bitcoin price of around $563K. We are not there yet, and there is no guarantee that Bitcoin adoption will continue to follow the Internet adoption S-curve in the years to come. However, it is one scenario among many to consider. As you can see, this would have a major impact on the price of Bitcoin.

In the future, the main limit to the adoption of Bitcoin will be the adoption of the Internet itself throughout the world. Indeed, to use Bitcoin, all you need is the Internet and a way to connect to it: typically a smartphone or a computer.

The last interesting point in this chart I have provided is that in the pattern that the Bitcoin adoption curve is currently following, we are still well into the “Innovators” phase. Something that anyone who thinks they are too late with Bitcoin should keep in mind, as I explained in the article on the 7 signs that you are still an early adopter if you buy Bitcoin today.