A new report from Juniper Research has found that the number of active bitcoin users worldwide will reach 4.7 million by the end of 2019, up from just over 1.3 million last year.

However, the report, "The Future of Cryptocurrency: Bitcoin & Altcoin Impact & Opportunities 2015–2019," contends that use will continue to be dominated by exchange trading, with retail adoption largely restricted to relatively niche demographics.

According to the report, while a number of high profile retailers are enabling bitcoin payment, activity levels from both online and offline deployments are extremely low.

"While average daily transaction volumes have increased by around 50 percent since March 2014, the indications are that much of this growth results from higher transaction levels by established users rather from any substantial uplift in consumer adoption," Dr. Windsor Holden, the report's author, said in a statement.

The report cited a number of factors that it said would continue to inhibit growth, most notably the difficulty in communicating the concept of cryptocurrency payments to end users. It also said that bitcoin's historical association with — and continued use by — criminals for illegal purchases and money laundering was likely to act as a further deterrent to mass adoption.

Meanwhile, the report observed that with many bitcoins being hoarded by early speculators, currency supply could be further restricted with Bitcoin mining profitability threatened by a combination of the cryptocurrency's volatility, lower bitcoin yields and rising electricity costs.

Other findings from the report:

• The introduction of licensed, regulated exchanges could lead to a stabilization in currency values and, with it, an increase in retail transaction adoption.
• The protocols behind cryptocurrency could be deployed in areas such as real-time transaction settlement.
• The altcoin market continues to be plagued by "pump and dump" currencies created solely as short-term investment vehicles.

The whitepaper, Will Bitcoins Bite Back?, is available to download from the Juniper website together with further details of the full research and the Interactive Forecast Excel.