Coinhouse, Ledger, and even Just Mining have seen unexpected growth for the past two months. But the limitation isn’t necessarily the only factor in this craze.
And the safe havens of the coronavirus crisis are gold … and cryptocurrencies, the star of which is Bitcoin. Even if the price of the latter hasn’t peaked in late 2017 (it was around $ 20,000 versus $ 8,500 today), trading volume has exploded globally in recent weeks. For example, on March 19, the American exchange Coinbase processed a volume of more than 2 billion US dollars. The French crypto sector is also benefiting from this widespread enthusiasm. « Actors in contact with the public, that is, brokers and exchanges, are seeing their volume increase. There is renewed interest in crypto in France, » confirms Simon Polrot, president of the Association for the Development of Digital Assets (Adan). « BtoB players have more problems, » he adds.
The Coinhouse Broker is the perfect example. « The growth was particularly strong in the first quarter of 2020 and increased towards the end of the quarter, » says Managing Director Nicolas Louvet. « And the situation continued into April, » he adds, without revealing the exact quantities. According to the broker, the number of unique visitors to the platform has doubled in the past few months, the conversion rate has improved, and activations have increased by 30%. The activations correspond to the accounts created that carried out a transaction in the following month.
The number of unique visitors to the Coinhouse site has doubled
« People come with a real buying intention, while they usually look at the markets, look for an entry point and take some time before buying, » says Nicolas Louvet, who says 80% of transactions are orders. The average amount has increased by 10% to 1,500 euros in the last three months. The young French exchange Deskcoin, which is not fully accessible to the public, is also in good shape. The platform normally processes bitcoins worth around 150,000 euros per month. Today it’s almost half a million. The same observation at Paymium, also French, which speaks of « good growth » since March, without giving further details.
Control of production in France
Ledger, the specialist in securing cryptocurrencies, is also not affected by the crisis. « Business went very well in the first quarter and the month of April is even better. We are recording double-digit growth, which has even been almost three-digit since the beginning of the year, » said Pascal Gauthier, CEO of Ledger. The lead product, the Ledger Nano, a type of USB stick that can be used to securely store cryptocurrency, is driving most of that growth. « When the US announced the restriction, our sales increased significantly, » explains Pascal Gauthier, who mentions tens of thousands of units. Thanks to the plant in Vierzon (Cher), Ledger was able to ensure the shipping of its products without any problems. « Since we decided to repatriate part of the production to France and we decided to keep the supply part in-house, we were able to ensure the continuity of the business from production to online sales, » says the market leader.
« When the US announced the lockdown, ledger sales soared »
Just Mining is less general than Coinhouse or Ledger and has also been successful since childbirth. The Florange-based company offers solutions for investments in the sector (machines to validate transactions on the blockchain network, network nodes, immobilization of a lot of cryptocurrencies in exchange for rewards, etc.). Sales tripled in March compared to February and tripled again in April. « We have two to three times more new customers a month and the historical ones order more than usual, » says Owen Simonin, his boss.
Crisis factor or halving factor?
This appetite for cryptocurrencies does not surprise those affected. « Bitcoin gets its full meaning with every financial crisis, » says Owen Simonin. « People want to seek refuge. They see Bitcoin as a store of value and liquidity that they can withdraw at any time. They understand that we cannot put all our eggs in one basket, » he adds. « Bitcoin has been less affected than other assets since the start of the crisis. It almost regained price before March. Talk by the ecosystem that Bitcoin is a safe haven or an alternative asset has ultimately worsened. People tell yourself that so is the opportunity is to buy it, « adds Simon Polrot.
But as always in the crypto world, it is difficult to isolate one factor, in this case containment, to understand the current craze for the industry. Another reason could explain this growth: the halving. This event, scheduled to take place on May 11th, cuts the rewards for minors in half. As with the last two halves (which happen roughly every four years), the volume of cryptocurrency exchanges increases before the famous date as supply becomes tight. « Halving can be a volume driver and a communication topic for Bitcoin in general, » notes Pierre Noizat, CEO of Paymium.
The combination of three factors, namely containment, halving and financial crisis, could well explain the good health of the sector. « I don’t know if it’s the combination of these three events or if it’s one of the three. Or just a crypto craze. Anyway, a lot of people think that a little bit of Bitcoin isn’t a bad idea. Time of crisis. We know not really how much a euro or a dollar will be worth tomorrow « , escapes Pascal Gauthier. Tomorrow is also the big unknown for Bitcoin, and not just for its value: will consumers continue to be so interested in their personal finances after a deconfinance? Nothing is safe in the crypto world.