According to foreign media reports on February 25, a report predicts that the value of the hardware wallet market will reach $ 495.9 million by 2024, with a compound annual growth rate of 24.93%.
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Hardware Wallet Market Overview
A hardware wallet is an encrypted physical device that stores private keys of cryptocurrencies offline. Private keys are required when using this type of wallet, and these wallets enable traders to securely store private keys while protecting information.
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Global investment in cryptocurrencies increased from $ 18 billion in January 2017 to more than $ 800 billion in January 2018. As investment has grown, people have begun to use their private keys to keep their cryptocurrencies. On average, more than 250,000 Bitcoin transactions occur every day, so hardware wallets are expected to be the key to providing security for holdings.
At the same time, cryptocurrencies pose security risks to hardware wallets. Although the hardware wallet provides higher security and trust for the data processed and stored in the device, it also needs a certain degree of protection from various attacks.
The Federal Reserve Bank of St. Louis, one of the 12 regional banks in the U.S. central banking system, also recognizes four cryptocurrencies: Bitcoin, Litecoin, BCH, and Ethereum. With the United States at the heart of the cryptocurrency industry, hardware wallet consumption in the country is expected to remain strong. Active participation in other areas will further promote growth in the hardware wallet market. In addition, South Korea's growing demand for hardware wallets is expected to affect Asia Pacific's position in the global market.
Advantages of hardware wallets
A hardware wallet is a special type of cryptocurrency wallet that stores the user's private key in a secure hardware device. They have the following main advantages over standard software wallets (hot wallets):
- The private key is usually stored in the protected area of the microchip and cannot be transmitted from the device in clear text.
- Hardware wallets are immune to computer viruses.
- Can be used safely and interactively; private keys never need to come in contact with any potentially vulnerable software.
NFC type hardware wallet facilitates payment
Cryptocurrencies like Bitcoin can be easily used in a real-world environment without the need for a bank license. Paying with cryptocurrencies can also be used to save money for merchants and protect customer privacy.
Although cryptocurrency has the potential to become a convenient, fast and secure payment method, its application in real stores is progressing slowly. With NFC (near field communication), you can pay even if the payee or payer is not connected to the Internet. For tourists who are unwilling to pay high roaming fees, or have low receiving efficiency when they are on the network, or even no network in the tourist destination This option is especially useful for tourists.
Similar to Apple, BitPay added NFC support to its PoS (point-of-sale) software in 2015, allowing users to pay their bills with an Android wallet with a single tap. The wallet's NFC transmission is traditionally provided by QR code for payment data, including the amount, payment address and transaction memo.
Expected significant growth in Asia Pacific
Thanks to the increasing popularity of cryptocurrencies and the growing trend of digital and cashless economies in India, Japan and South Korea, the Asia-Pacific region has become the fastest growing market for hardware wallets.
Although China's restrictions on digital currency transactions may hinder growth in the region, other countries in the region (especially India, Japan, Australia, and South Korea) are increasingly accepting the digital economy and are forming a huge crypto in the Asia-Pacific region. currency market.
Thai security companies are also exploring the possibility of setting up and operating a joint cryptocurrency exchange in Bangkok. These developments demonstrate the government's positive attitude towards cryptocurrencies and are expected to drive demand for research markets in the region.
The competitive landscape of hardware wallets
The market for hardware wallets is fragmented. The main players in the market are made up of several global and regional companies, such as Ledger SAS and SatoshiLabs SRO.
Because the hardware wallet market has lower thresholds for new players, some new players have been able to gain attractiveness in the market through competitive prices and the provision of feature-rich products. Therefore, the market is characterized by an increase in product penetration, product differentiation and high competition.