Key Points
- Binance’s CEO Richard Teng discusses the worldwide crypto adoption, along with Web3’s rise in real utility.
- His analysis comes after Binance reached the important milestone of 200 million users during the weekend.
Binance recently marked an important milestone of 200 million users and the exchange shared a post on X today, revealing the new chapter of innovation in the crypto industry.
The exchange’s rapid growth mirrors the fast crypto adoption and Web3’s rise in real utility compared to any early tech.
We’re entering a new chapter of innovation.#Binance200M’s growth mirrors the fast adoption of digital assets at large.
Today, Web3 has more real utility than any early tech. Early adopters can win big.
Read more from @_RichardTeng ⤵️https://t.co/XYUDLZlrGO
— Binance (@binance) June 10, 2024
An analysis of the blockchain innovation era
Binance’s CEO, Richard Teng, analyzes the era of blockchain innovation. In a new blog post, Teng addressed Binance’s latest achievement, calling it a momentous event for the entire blockchain industry and a huge milestone in the history of innovation.
In all of history, tech innovation managed to disrupt established industries and it reshaped economies. Today, the rise of blockchain tech and the transition of the dominant internet paradigm from Web2 to Web3 is the latest disruption wave.
The blog post analyzes the acceleration of tech disruption cycles, noting that the pace of tech innovation has accelerated with each of them. The Industrial Revolution began in 1760 and it took a few decades to transform industries.
The Internet revolutionized the world more rapidly following a few decades. The World Wide Web (Web1) in the 90s catalyzed mass adoption on a global scale thanks to the layer of utility and accessibility that it added to the existing Internet infrastructure.
Technology transformed communication, commerce, and entertainment in just a few years after that.
Now, Web3 and blockchain tech are advancing at a pace never seen before. Bitcoin which was created back in 2009, laid the groundwork for a new asset class that managed to get mainstream attention in less than a decade.
Now, millions of people all over the world use crypto to transfer value online, engage in DeFi activities, and benefit from smart contract-powered functionalities.
Crypto and blockchain tech have more to show in terms of real-life usage and driving consumer value forward. There’s an enormous upside potential and a considerable adoption curve suggests that the new tech is heading toward the mainstream.
The exponential nature of crypto adoption
Binance is the best example to demonstrate the exponential nature of crypto adoption along with the development of blockchain tech.
Binance was launched back in July 2017, and became the world’s largest crypto platform by trading volume in 6 months. The exchange reached 50 million users four years later, in May 2021.
Binance then reached 150 million in less time, June 2023. Now, after less than a year, the exchange has broken the mark of 200 million users.
Teng said that every time he looks at the curve, Everett Rogers’ classic diffusion of innovation theory comes to his mind. Diffusion is a process in which an innovation is communicated over time among the participants in a social system in more stages:
- knowledge
- persuasion
- decision
- implementation
- confirmation
People progress through the stages at different rates, which leads to varying adoption times. There are five groups of people categorized based on their readiness to embrace the new tech:
- innovators (approximately 2.5%)
- early adopters (13.5%)
- early majority (34%)
- late majority (34%)
- laggards (16%)
Innovators are the first to adopt the tech and are willing to take risks, followed by early adopters who usually become opinion leaders.
200 million people is a greater share of the global population than 2.5%. In reality, “we are many more than that,” Teng notes.
The innovators are already in, and early adopters are joining the movement en masse, spreading the word. This marks the beginning of mass adoption, according to expert opinions.
Cooptation or obsolescence
Based on history, incumbents often dismissed new tech and the insurgents advancing them, only to later recognize the innovations’ utility and value, the blog post notes.
The analysis brings up Alexander Graham Bell who invented the telephone in 1876 and the telegraph companies showed little interest in it, seeing it as an odd novelty. However, the telephone’s ability to provide instance voice communication demonstrated its value, leading to world adoption.
This also happened with personal computers as well, being seen as toys for hobbyists at first, only to witness adoption later. Now, PCs are essential tools for business and personal use.
Blockchain’s trajectory is the same – it was faced with initial skepticism from traditional financial institutions. But, adoption is now driven by its unique value proposition – disintermediation, transparency, and security.
When the new tech proves its worth, incumbents face a critical decision – adapting or becoming obsolete. Innovation means adaptation to embrace new technology.
Many of today’s incumbents have already chosen to adapt to the wave of blockchain-led disruption rather than ignore or fight it.
The most vivid example is cited as being financial giants such as BlackRock and Fidelity with their Bitcoin ETFs. JPMorgan, IBM, and more are exploring blockchain tech and integrating it into their operations to enhance security and efficiency.
Those who fail to adapt may become obsolete as decentralized systems are gaining prominence. The future will likely see a mix of cooptation and competition as blockchain reshapes the financial landscape and more industries.
