Coinbase Inc., one of the biggest cryptocurrency exchanges around the globe, was extremely busy last year as digital tokens took off. The exchange signed up 50,000 new customers a day, according to its CEO.
That’s according to Brian Armstrong, the cryptocurrency exchange’s chief executive officer, who made the comments at the Bloomberg Players Technology Summit being held in San Francisco this week. Amid a frenzy of interest in cryptocurrency — namely Bitcoin — last year, investors of all stripes wanted a piece of the action. That sent the price of bitcoin up to nearly $20,000.
Cryptocurrencies Are Tanking
Since then most cryptocurrencies have plummeted. It doesn’t help that cryptocurrency exchanges have been hacked. As concerns rise that entrepreneurs are cashing out their initial coin offerings and that some digital tokens including Bitcoin may have become overvalued, nearly all of the largest cryptocurrencies are declining. According to the Wall Street Journal, the value of cryptocurrencies this week fell below $200 billion for the first time this year. The sell-off has been broadly based with research firm CoinMarketCap finding that over the 100 top digital tokens by market value, 98 were trading lower during the past 24 hours.
The declines in August come on the heels of a rally in July as investors bet a bitcoin exchange-traded fund would receive regulatory approval in the U.S. Many investors view Bitcoin and cryptocurrency ETFs as a way to bring legitimacy to a market that is anonymous and unregulated. Investment firm VanEck and Solid X, a financial service company, partnered earlier in the year to get approval for a bitcoin ETF, but these efforts were rejected by the SEC. The SEC decided to delay making a decision until Sept. 30. (See more: Crypto Market Caps Plummet on Bitcoin ETF Woes.)
Coinbase CEO Says Adoption Increasing
Still, Armstrong isn’t worried. “This technology is going through a series of bubbles and corrections, and each time it does that, it’s at a new plateau,” Armstrong said at the conference. “People’s expectations are all over the map, but real-world adoption has been going up.” (See more: How Cryptocurrency Pump-and-Dump Scams Work.)
During the course of the past year, Coinbase has enabled customers to make cryptocurrency trades to the tune of $150 billion, the CEO said, declining to say what the current rate of new customers sign-ups are. Acknowledging that it will take a while before cryptocurrencies are used for everyday purchases, he estimated that about 10% of digital tokens are used to make purchases in real life, in games and online. Nevertheless, Armstrong said Coinbase is still in growth mode. It currently has about 1,000 employees and is growing, noted Bloomberg.