According to Chainalysis, cryptocurrencies have become increasingly popular in emerging markets.
On Global Cryptocurrency Adoption Index 2022Blockchain analysis firm Chainalysis highlighted that global adoption of cryptoassets is being led by emerging markets, although major powers such as China, where there is a strict ban on these digital assets, continue to have a significant share in this market.
However, it is Asian countries, such as Vietnam and the Philippines, that are leading the use and adoption of crypto assets globally.
Chainalysis analyzed a total of 146 countries for its report, ranking each country’s crypto-related activity based on five key metrics: the value of crypto transacted via exchanges, the retail value transacted by non-professional individual investors, the trading volume in peer-to-peer (P2P) trading, the volume of crypto transacted via DeFi, and the retail on-chain value received via decentralized protocols.
The firm concluded that despite the bear market, which has led to a tumultuous year for cryptocurrencies and slowed their adoption, the fundamentals underpinning their global use appear to be quite healthy.
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Vietnam and the Philippines lead the global cryptocurrency market
Through the 2022 Global Cryptocurrency Adoption Index, Chainalysis seeks to determine not only where the most activity with cryptocurrencies is occurring, but also seeks to measure where most people are investing the majority of their money in the crypto market, highlighting the countries where there are the largest number of non-professional individual investors immersed in the cryptoasset market.
The blockchain firm has thus determined that Vietnam and the Philippines are the two emerging Asian countries and markets that are leading the global adoption of cryptocurrencies.
Source: Chainalysis
Vietnam
Vietnam ranks first in the world on Chainalysis’ 2022 Global Cryptocurrency Adoption Index. According to the blockchain firm, the Asian country boasts the highest rate of cryptocurrency adoption across exchanges, DeFi, and P2P trading.
Also, by 2020, 21% of Vietnam's population reported using cryptocurrencies and digital assets.
Vietnam is also home to one of the world’s leading play-to-earn game developers, Sky Mavis, creator of the popular video game Axie Infinity. Sky Mavis is headquartered in Ho Chi Minh City, according to Chainalysis.
Philippines
The Philippines is one of the countries with the highest web traffic to NFT marketplaces, alongside Thailand and Vietnam. Chainalysis believes that a large part of this web traffic related to NFT projects may come from blockchain gaming users.
Sending remittances through cryptocurrencies is also one of the most important activities taking place with crypto assets within this country. According to data collected by the firm, the cryptocurrency remittance market represents 9,6% of the country's GDP.
Other countries leading the adoption of cryptocurrencies
The United States, the world's leading power, ranks fifth as one of the countries with the highest levels of cryptocurrency adoption worldwide.
China, the world’s second largest country and the country with the largest ban on cryptocurrencies, ranks in the top 10 of Chainalysis’ Global Crypto Adoption Index, seeing strong activity in crypto usage from centralized services. China currently ranks second overall by purchasing power-adjusted transaction volume, both overall and retail, Chainalysis said.
In the case of Europe, the continent continues to position itself as the largest cryptocurrency economy in the world. Furthermore, increasing regulations, which seek to provide greater regulatory clarity for the crypto market, promise to further boost cryptocurrency activity in the region.
The most common use cases for cryptocurrencies
According to Chainalysis, within both upper-middle-income and lower-middle-income countries, cryptocurrency users are more likely to use these digital assets for remittances, as well as using crypto assets as investment assets to preserve their savings in times of economic volatility and uncertainty.
This is the case of countries such as Vietnam, the Philippines, Ukraine, India, Pakistan, Nigeria, Morocco, Nepal, Kenya, Indonesia, Brazil, Thailand, Russia, China, Turkey, Argentina, Colombia and Ecuador, which are classified as lower-middle-income and upper-middle-income countries according to the World Bank.
In these countries, according to the report presented by Chainalysis, there is greater use of Bitcoin, the main cryptocurrency on the market, and stablecoins, such as USDT and USDC.
What is the current level of crypto adoption?
Despite the current bear market, Chainalysis believes that the crypto market has healthy fundamentals that have continued to drive its growth and development in recent years.
Source: Chainalysis
Although cryptocurrencies reached their highest levels of adoption ever seen last year, the crypto market has seen consistent growth since mid-2019, and adoption levels currently remain well above those seen before this date.
As we see in the Chainalysis report, the cryptocurrency market continues to grow, use and adoption as it is unlocking unique opportunities for everyone around the world.
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