Cryptocurrency apps floundering as bitcoin sinks amid sector sell-off

New statistics show Australian crypto app downloads are down by as much as 80 per cent, as the industry braces for more lay-offs.

Statistics from market intelligence firm Sensor Tower show that the hype around crypto among Australian investors is dying out, with overall crypto smartphone application downloads down 72 per cent in 2022 from 2021, while the top ranked app CoinSpot is down 82 per cent. Picture: AFP

The popularity of crypto smartphone apps like Kraken, CoinSpot and Swyftx has cratered in Australia, new statistics show, with download numbers down by as much as 80 per cent year-on-year amid the ongoing crypto winter and company lay-offs across the industry.

Statistics from market intelligence firm Sensor Tower show that the hype around crypto among Australian investors is dying out, with overall crypto smartphone application downloads down 72 per cent in 2022 from 2021, while the top-ranked app CoinSpot is down 82 per cent.

Sensor Tower’s regional director Eugene Du Plessis told The Australian that appetite for crypto apps had plummeted following the crash of stablecoin TerraUSD last month, spooking investors.

“Crypto app downloads are fundamentally in lock-step with the value of bitcoin, so any market fluctuation has a direct impact on consumer behaviour,” Mr Du Plessis said.

“Coinspot currently has the highest daily active users and Binance users aren’t far behind, showing while fewer people are downloading these apps, activity remains high for those already using them. I expect to see new entrants entering the market once the sector stabilises, particularly within the NFT space.

Statistics from market intelligence firm Sensor Tower show that the hype around crypto among Australian investors is dying out. Picture: Gabby Jones/Bloomberg

“While crypto app download has slowed for the time being, we’re seeing no signs of this across the app market more generally. In fact, our latest Sensor Tower report has shown that Australia is the top forecasted climber globally, with our app market set to be worth over $7bn by 2026.”

The statistics show that demand for crypto apps has tumbled across the board. Binance was downloaded around 41,400 times in May 2022, a severe drop from 163,200 downloads in May 2021, while Coinbase was downloaded around 14,300 times, down from a 75,200 a year earlier.

The price of Bitcoin is hovering at around the $30,000 mark, a far cry from its highs of more than $90,000 in November 2021. Picture: AFP

Other top crypto apps including MetaMask, Swyftx, CoinJar and Kraken all suffered double digit percentage drops in downloads, the statistics show.

The decline in app popularity comes amid a wave of lay-offs for the crypto sector. Trading platform eToro announced over the weekend it was laying off 100 employees – about 6 per cent of its total workforce – and terminated its plans for a SPAC merger deal that would have sent the company public.

According to Sensor Tower’s statistics, eToro is Australia’s ninth most popular crypto trading app, with around 9400 app downloads in May 2022, down from around 37,300 in May 2021.

“Due to the current market conditions and after a period of accelerated growth we decided to take in the current period a more balanced approach between growth and profitability,” eToro CEO and co-founder Yoni Assia said in a statement.

“As a result, we made a difficult decision to cut our workforce in order to ensure long-term sustainable growth.”

Crypto lender Celsius last week also announced it was laying off 150 employees, while fellow crypto companies Huobi, Abra, Coinbase, Crypto.com, Gemini and Banxa have all cut staff in recent weeks.

The price of Bitcoin is hovering at around the $30,000 mark, a far cry from its highs of more than $90,000 in November 2021.

Nigel Green, the chief executive of one of the world’s largest independent financial advisory firms, deVere Group, recently criticised some major crypto firms for making expensive TV ads and signing sports sponsorship deals amid widespread crypto industry lay-offs.

“I’m not in the habit of throwing shade at other companies, but in recent times we’ve seen many of the biggest players make huge, unnecessary mistakes,” he said.

“They went for enormously expensive TV ads, jumped on highest-tier sponsorships, rolled-out lending models offering astronomical interest rates on crypto deposits, and launched unprecedented hiring sprees.

“Now, what do we have? Firms laying off swathes of staff, freezing client withdrawals and cutting back on investment.

“Unfortunately, these brands have made some classic, obvious and avoidable dotcom era errors. Such crypto firms would be better off – for the sake of their clients and the wider industry – growing through investing in top talent, innovation and development, and lobbying for sensible regulation with financial watchdogs.”