Bloomberg ETF analyst Eric Balchunas has drawn a striking parallel between Bitcoin’s current adoption phase and Facebook’s trajectory, suggesting that the cryptocurrency is entering a period of substantial growth similar to when the social media giant expanded from one billion to three billion users.
This comparison frames Bitcoin’s diminishing “cool factor” as a sign of maturation and mainstream acceptance, with the recent approval of spot Exchange-Traded Funds (ETFs) serving as a key catalyst for this shift.
Key Takeaways
- Eric Balchunas believes Bitcoin is currently mirroring Facebook’s phase after its initial “coolness” faded and older demographics joined.
- Facebook’s user base nearly tripled, growing from 1 billion to over 3 billion, during the period after its countercultural appeal waned.
- Global Bitcoin holders have seen a significant increase, growing from an estimated 30-50 million in 2021 to approximately 106 million today.
ETF Expert Likens Bitcoin to Facebook’s “Uncool” Phase
Balchunas, a respected figure in the ETF space and co-host of the “Trillions” podcast, articulated his view by comparing Bitcoin’s present situation to the time when Facebook began to attract a wider, less trend-driven audience, including older generations.
He stated, “Bitcoin rn feels like when your parents joined Facebook. On one hand, it’s not as ‘cool’ anymore because of the Boomers, but on the other hand, Facebook’s user base grew from like 1 billion to 3 billion people since the coolness factor went away, so…”
Facebook reached the milestone of 1 billion monthly active users in 2012. By the close of 2023, this number had surged to over 3.07 billion. While the year-over-year growth rate dipped below 10% after 2013, the platform’s absolute user count almost tripled during this less trendy period.
The Numbers Behind the Analogy
Further supporting his analogy, Balchunas highlighted the influx of capital and users into Bitcoin, particularly through new financial products. He mentioned that BlackRock’s iShares Bitcoin Trust (IBIT) alone attracted roughly 1 million investors within its first year of operation.
Current estimates indicate that the total number of global Bitcoin holders stands at around 106 million. This represents a substantial increase from the estimated 30 to 50 million holders recorded in 2021. BlackRock’s IBIT now holds a significant amount of Bitcoin, with 782,180 BTC, accounting for approximately 3.9% of the total supply.
This trend is observed by some macro analysts who note that despite recurring predictions of Bitcoin’s demise, the cryptocurrency appears to be in its nascent stages of broad adoption. The transition of an asset from niche appeal to attracting passive, mainstream capital often signifies the beginning of its most significant growth phase, rather than its peak.
The ongoing trajectory of Bitcoin’s holder base, particularly since the approval of ETFs, suggests that it may indeed follow Facebook’s path toward reaching billions of users.
Information compiled from materials : beincrypto.com