Hardware wallet providers see an increase in revenue amid the falling cryptocurrency market as crypto investors seek to secure their assets and withdraw them from centralized exchanges (CEX).
A bearish trend in the crypto market is affecting everyone in the crypto ecosystem, but hardware wallet providers are boosting sales amid the downturn. Cointelegraph reports this, citing industry representatives.
According to Ledger CEO Pascal Gauthier, the company’s revenue from selling cryptocurrency wallets has not declined due to the crypto market downturn. Moreover, it has shown significant growth. Gauthier stressed that the firm has been generating quarterly revenues equal to Ledger’s annual profits in 2020, when the company was at its peak.
Other hardware wallet providers are also seeing revenue growth during the market decline. For example, Trezor’s analyst Josef Tětek claims that the firm has also recorded a significant increase in interest in its devices over the past few months. GridPlus CEO Justin Leroux said that the company is ramping up production in an effort to meet increased consumer demand for its products.
The main prerequisite for the growing popularity of hardware wallets was the lack of security for the assets of centralized exchange (CEX) users in the event of their bankruptcy. Users became more concerned about the security of assets stored on CEXs and considered withdrawing funds from their accounts. In particular, this happened after Coinbase published a loss report and suspended withdrawals for users from Celsius crypto platform accounts. For instance, Ledger’s representative said that the company received $2 million in revenue per day after Coinbase’s report was published.
Hardware wallet providers are actively adapting to the sudden surge in users trying not to lose popularity. The industry is actively developing new products to meet today’s market demands:
- Arculus recently announced support for NFTs and the WalletConnect integration, which will allow consumers to browse NFTs and DApps in their ecosystem;
- Ledger developers are focused on developing products for Web3;
- Trezor is exploring options for implementing Lightning Network capabilities for its users.
Industry representatives also say that another factor behind the increased interest in hardware wallets is the rise in hacking attacks.
