The growth of the cryptocurrency industry among the masses is undoubtedly slower than the rapid expansion of the public internet, no matter how you spin it.
But why does it matter? While many toss around the idea that crypto is on the same path as the web, it’s essential to examine the hard facts and figures.
In the depths of the issue, the experts at Architect Partners, a leading mergers and acquisitions advisory firm, have delved into a thorough year-by-year analysis comparing the early days of the internet to the current state of the budding crypto world.
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The study sets the dawn of the internet at 1995, when America Online was distributing infinite installation CDs, and marks 2017 as the beginning of the cryptocurrency era, when tokens began to stir up a frenzy of global speculation.
Notably, this puts each genesis year a solid four years ahead of their respective speculative bubbles.
So, what do the numbers say? Let’s take a closer look. In the year following their respective bubbles, the internet received a staggering $75 billion in investments, while crypto only saw $29 billion.
However, both domains experienced a significant decline in investments the following year.
But when it comes to valuation, the internet reigned supreme with a peak value of $5.6 trillion in 2000, compared to crypto’s peak of $3 trillion.
When adjusted for inflation, the early internet would be valued at a whopping $9.6 trillion in today’s terms.
In terms of user base, the internet boasted an estimated 414 million users in 2000, while crypto only had around 190 million in 2022.
But, it’s worth noting that this number could be inflated, as the authors are counting crypto wallets as individual users, even though many individuals may have multiple wallets. The true numbers are difficult to determine.
Ultimately, the report raises an intriguing point: Is blockchain technology just a solution in search of a problem? Or is it simply more challenging to enter the world of crypto compared to the relatively easy access to the internet in the mid-1990s?
Back then, connecting to the web was a headache, with dial-up connections and the need to manually install a modem on your computer.
But perhaps the biggest obstacle for the adoption of money-on-the-internet is the powerful global financial system, which has proven to be more resilient than brick-and-mortar retailers resisting the rise of e-commerce.
In 2024, as bitcoin finally presses the “easy button,” we may still be years away from the equivalent of Facebook’s IPO in 2012. And even then, there were plenty of skeptics who doubted its ability to generate real profit.
So, while it may be 2002 or even 2006 in terms of the development of blockchains, we still have a long way to go before reaching the same level of mainstream success as the internet. But who knows what the future holds for the world of crypto? Only time will tell.
