Cryptocurrencies Need to Improve Stability and Scalability to See Large-Scale Adoption, Says GlobalData


  • Total market capitalization of the cryptocurrency industry $ 2.5 trillion as of October 2021.
  • Bitcoin is the leading cryptocurrency with a 46% share of the total cryptocurrency market.
  • Bitcoin needs to increase its payment capacity to be used on a larger scale.

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Cryptocurrency networks need to improve their stability and scalability if they are to be adopted as the official currency, says GlobalData, a leading data and analytics company.

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Cryptocurrencies have flourished due to lack of regulation

GlobalData’s latest report, “Blockchain in Payments,” notes that a lack of international regulation has allowed the cryptocurrency industry to thrive, reaching a market capitalization of $ 2.5 trillion in October 2021. This one is largely made up of Bitcoin which accounts for 46% of the market. . However, if Bitcoin is to challenge established payment systems such as Visa and Mastercard, cryptocurrency must solve its scalability problem. Currently, Bitcoin can only handle seven transactions per second (TPS), compared to 24,000 TPS * for Visa. However, even with these improvements, market growth can be quickly stifled if trading in cryptocurrencies is banned – a move India is currently considering.

Chris Dinga, Payments Analyst at GlobalData, comments: “While the lack of regulation drives the growth of cryptocurrencies, their decentralized nature means that growing investment and reliance on the cryptocurrency industry could weaken governments’ control over the economy. This is not a situation some governments are willing to tolerate as India, one of the world’s largest economies, is already moving to crush cryptocurrencies before they can gain even more popularity. To survive, the industry must quickly become “too big to fail” by overcoming its TPS limitations to continue its rapid growth. “


Cryptocurrency market capitalization

While there are over 1,200 cryptocurrencies currently traded, the majority of the cryptocurrency market cap consists of just a handful of brands – Bitcoin being the main one, with a market cap of $ X. . Since the launch of Bitcoin, the market has seen the introduction of new blockchain networks such as Ethereum ($ 458.8 billion), Ripple ($ 38 billion), Solana ($ 49.8 billion) and Cardano ( $ 41.9 billion) ****. These networks were developed to address some of the limitations of Bitcoin and to make cryptocurrencies more applicable to real world needs.

Dinga continues: “Currently limited to 13 TPS, Ethereum is working on upgrading to Ethereum 2.0 (Eth2) which should allow it to handle 100,000 TPS. However, for Eth2 to keep this promise, it will need to avoid the kind of instability seen by Solana, which claimed to manage over 700,000 TPS **, but experienced a network outage in September 2021 when its transaction volume reached. 400,000 GST. “




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