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Cryptocurrency Market is on its Way to Replace Traditional Payment Means

The Global Cryptocurrency Market size is expected to grow from USD 1,542.9 Million in 2021 to USD 2,302.5 Million by 2028 at a Compound Annual Growth Rate (CAGR) of 6.9%. Cryptocurrency is a unit of currency in the form of an encrypted data string. It is organized and monitored by a peer-to-peer network known as a blockchain. blockchain also serves as a secure ledger of transactions.

The primary factor driving the Cryptocurrency Market's growth is the growth of distributed ledger technology and rising digital investments in venture capital. Developing countries have started using digital currency as a financial exchange medium. The increasing popularity of digital assets like Bitcoin and Litecoin is likely to drive market growth in the forthcoming years. Moreover, Cryptocurrency is also often utilized with the integration of blockchain technology to attain decentralization and controlled efficient transactions. Blockchain technology offers decentralized, fast, transparent, secure, and reliable transactions. With these advantages of blockchain and digital currency, companies are investing in Cryptocurrency and collaborating with other companies to deliver efficiently and quality services to the users.

With the spread of the global Coronavirus pandemic (COVID-19), the relationship between Bitcoin and the equity market has expanded. Although the long-term impact of COVID-19 on economies cannot be predicted, considering the cultures and individuals’ well-being, it seems a reasonable bet that the reaction of central banks would build an ideal atmosphere for the Cryptocurrency Market to sustain. If Bitcoin continues to outperform conventional markets, it may certainly spark further interest in Cryptocurrency as an alternate and sustainable form of currency. The penetration of virtual currencies in digital payment is expected to affect cross-border remittances. The financial institution is directing toward blockchain technology which is expected to drive the Cryptocurrency Market in upcoming years.

Based on components, the Global Cryptocurrency Market has been segmented into software and hardware. The hardware segment is further classified based on platform types such as Graphical Processing Unit (GPU), Field Programmable Gate Array (FPGA), Application Specific Integrated Circuit (ASIC), and others. The hardware segment comprises hardware-implemented for Cryptocurrency mining and exchange. ASIC mining hardware is expected to hold the largest share mainly due to its high performance and high hash rate while mining a specific coin. The software segment is further categorized into mining software, exchange software, payment, wallet, and others. Significant dispersion of exchange platforms is likely to drive the market globally. Software wallets or digital wallets are seen to be adopted majorly due to their security enhancement.

Based on type, the Cryptocurrency Market is segmented into Bitcoin (BTC), Litecoin, Ether, Ripple, Ether Classic, and others. Among these, Bitcoin is one of the most used digital currencies, and it will maintain its dominance over the coming years. Ether, a virtual currency that can be used for accounting, investing, and establishing smart contracts and decentralized applications, is another popular virtual currency on the market. Based on end-use, the market is segmented into trading, e-commerce and retail, peer-to-peer payment, and remittance. Trading captured the largest market share. The segment focuses on Cryptocurrency solutions that are used for trading. E-commerce and retail companies have started accepting Cryptocurrency as a payment option. For instance, in September 2019, The German branch of the chain Burger King restaurant accepted bitcoin as payment for its online deliveries and orders.

Geographically, the Cryptocurrency Market is segmented across five major regions, namely, North America, Europe, Asia Pacific, the Middle East & Africa, and Latin America. North America captured the largest share in the global market in 2021, as most of the region treated bitcoins as a medium of exchange for tax purposes rather than currency. Acceptance of digital cash by consumers as well as retailers drives the growth of the market. Additionally, the popularity of bitcoin mining and the presence of a majority of key players dominate the Cryptocurrency Market in North America.

Strategic collaborations and partnerships by key players contribute to the Cryptocurrency Market in the Asia Pacific. For instance, in January 2020, Z Corporation, Inc. and TaoTao, Inc. announced a collaboration with the financial service agency to expand the Cryptocurrency Market by confirming regulatory compliance in the Japanese market. Similarly, Malaysia’s Securities Commission legally has authorized digital currency exchange operators to operate in the country despite the national lockdown due to the coronavirus pandemic.

The high competition in the Cryptocurrency Market is forcing companies to focus on different strategic initiatives to strengthen their market positions. Some of the key players in the market are Bitmain (China), NVIDIA (US), Xilinx (US), Intel (US), Advanced Micro Devices (US), Ripple Labs (US), Ethereum Foundation (Switzerland), Bitfury Group (Netherlands), Coinbase (US), BitGo (US), Binance Holdings (China) Canaan Creative (China). Bitstamp (Luxemburg), Ifinex (Hong Kong), Ledger SAS (France), Xapo (Hong Kong), and Alcheminer (US).