A new report from Juniper Research forecasts that the number of bitcoin and altcoin transactions will more than double by 2017 to 56 million, up from 24.7 million in 2014 and 18 million in 2013.

The finding is part of a new report from the market intelligence firm that analyzes the volume and value of transactions in the cryptocurrency markets and predicts the value of all bitcoin and altcoin transactions will fall by 58% in 2015, to just over $30bn.

Still, Dr Windsor Holden, head of consultancy and forecasting at Juniper, suggested that those who read the report should scrutinize its more positive conclusions, as he believes bitcoin is unlikely to gain significant transaction as a means of payment.

In particular, Holden voiced his belief that transaction volumes are not rising at a pace that would be on par with a technology reaching mass adoption.

Holden told CoinDesk:

“I think the challenges are so great that bitcoin will struggle as an actual payment mechanism. It will struggle to go over a fairly core audience who are the very techy and the libertarians, and those who partake in nefarious activities.”

Still, Holden sees potential for cryptocurrency to help improve the payments ecosystem. For example, he cited the decentralized payment system developed by Ripple Labs, which uses a native currency for settlement, as one that could become part of the financial infrastructure.

The findings are part of what Holden said is likely to be an annual report on the digital currency industry from the Juniper team.

For the report, Juniper used publicly available data to determine the volume and value of bitcoin, litecoin, dogecoin and auroracoin on a month-over-month basis throughout 2014.

Volume to rise, while value falls

Holden indicated that while the total value of bitcoin and altcoin transactions is likely to continue to fall, this is indicative of the recent decline in the bitcoin price.

While volumes will likely rise, Holden suggested, this increase won’t be enough to offset the total decline in value, which resulted in 58% decline projection.

He projected a “reasonable increase” in transaction volumes in 2015, but noted that much of this activity is taking place on exchanges, and is therefore not correlated to spending.

Further, he cautioned readers not to “believe the hype” surrounding the industry, stating that he believes the total user base for bitcoin to be smaller than advertised.

“When you look at the actual number of wallets and people who regularly make transactions, rather than just store half a bitcoin, you’re talking about a couple million max,” he added.

He also sought to debunk the idea that merchant adoption would lead to an increase in consumer use, adding: “It doesn’t necessarily follow that the more retailers that deploy it, the more people will use it.”

Steep education process

In his explanation, Holden compared bitcoin to another relatively new payment method, near-field communication (NFC) in the face of changing consumer behavior.

“I’ve argued that the issues facing NFC are nothing compared to the difficulties facing bitcoin from a trust and customer perception,” he said.

To this point, he cited the continued reports of scams in the bitcoin industry, mentioning Hong Kong’s MyCoin, which was recently revealed to have potentially absconded with roughly $8.12m in customer funds.

Source : http://www.coindesk.com/juniper-research-bitcoin-transactions-double-2017/

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