Based on estimates that the number of Bitcoin wallets has increased by four times from 8.2 mln in 2013 to nearly 35 mln in 2016, data from a new Visa-backed academic research suggests that the number of active wallets ranges from 7.5 percent to 30.9 percent of the total number.

The Global Cryptocurrency Benchmarking Study by the Cambridge Centre for Alternative Finance at the University of Cambridge puts the estimated number of unique active users of cryptocurrency wallets to have increased from between 0.6 mln and 2.6 mln in 2013 to currently between 5.8 mln and 11.5 mln in 2017.

As an inaugural research focused on alternative payment systems and digital assets, the study led by Dr. Garrick Hileman is the first of its kind to holistically examine the growing global cryptocurrency industry and its key constituents which include exchanges, wallets, payments and mining.

“81% of wallet providers are based in North America and Europe, but only 61% of wallet users are based in these two regions,” the study which collected non-public data from nearly 150 companies and individuals states. “Almost half of all wallet providers are located in the United States and the United Kingdom. If we break down origin by world region, Europe is leading with 42% of wallet providers, followed by North America with 39% and Asia Pacific with 19%.”

It highlights that despite many cases of internal fraud and bankruptcies of centralized exchanges, not one North American wallet provider thinks that existing regulations are adequate and 57 percent of European and 20 percent of Asian-Pacific wallet services appear to be satisfied with the current level of regulation.

P2P exchanges, on the other hand, have yet to gain more popularity as only two of the 51 exchanges represented in the study provide a decentralized marketplace for exchanging cryptocurrencies even as 40 percent of North American wallet services perceive existing regulations to be excessive and too strict - a view shared by 14 percent of European providers.

More fluid

Moving away from wallets, other key areas in which the study offers new insights on the innovative and rapidly evolving sector of the cryptocurrency economy across 38 countries from five world regions is that the industry is becoming more fluid.

It says the lines between exchanges and wallets are increasingly “blurred” and a multitude of cryptocurrencies after Bitcoin are now supported by a growing ecosystem as they fulfill an array of functions. It adds that the issues of security and regulatory compliance are likely to remain prevalent for years to come.