As analysts at US bank Wells Fargo have predicted in the bank's latest report, cryptocurrencies appear to be nearing a "hyper-adoption" phase similar to the internet in the second half of the 1990s.
Whether it's too early or too late to enter cryptocurrencies is a question one of the world's greatest asset managers has tried to answer in his latest report. A Wells Fargo Investment Institute report states that it is not too late to enter cryptocurrencies, but believes that we are entering a turning point in their hyper-adoption.
The report, entitled "Cryptocurrencies - Too early or too late," acknowledges that the number of cryptocurrency users is growing rapidly. Compared to the current adoption of cryptocurrencies to the internet in the 1990s, it has been indicated that we may be heading towards a hyper-adoption period.
In the summary of the report, we can read:
We believe that cryptocurrencies are profitable investments today, even though they remain in the early stages of their investment evolution. For now, we recommend professionally managed private placements as the investment landscape is still maturing.
"Early but not too soon"
There are currently 221 million cryptocurrency users worldwide, according to a recent study by Crypto.com. This number more than doubled in 2021 as cryptocurrencies gained mainstream popularity. By comparison, approximately 145 million Americans own stocks in publicly traded companies. In India, only about 3.7 percent (or 51 million), and in China, it is about 12.7 percent (178 million).
But with increasing adoption, are those who have yet to buy Bitcoin late?
Wells Fargo says they are not. According to the banking conglomerate, those entering now are in the "early, but not too early" range.
If this trend continues, cryptocurrencies may soon exit the early adoption phase and enter the hyper-adoption turning point, just like other technologies. There is a point where adoption rates start to rise and they don't look back. Putting the exact numbers aside, there is no doubt that global cryptocurrency adoption is on the rise and could soon reach the point of hyper-inflexion.
In support of its argument, the bank noted that most cryptocurrencies are less than five years old. Even Bitcoin, the oldest one, "has a lot more to do." BTC, despite having been in existence since 2009, is still four times more volatile than gold.
The report added that the current pace of adoptions is similar to that of the Internet in the 1990s. Such a comparison has already been made by a growing list of institutions and individuals.
As the chart above shows, the cryptocurrency is in a similar position to the internet in 2000. At that time, Google was just over a year old, Amazon was six, and Facebook was not to be created until another four years. Therefore, it is possible that many of the projects that will dominate the cryptocurrency universe in the years to come have still not been created.
Wells Fargo summed it up like this:
There is no need to rush, as most of the possibilities lie ahead, not behind us.
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