India leads the world in cryptocurrency adoption, followed by Nigeria and Vietnam, according to a new report from Chainalysis. However, North America accounts for almost a quarter of all value received by cryptocurrency exchanges, with the United States far and away ahead.
To calculate adoption, Chainalysis used Web traffic data from 13 billion web visits to track five categories of activity, weighted by per capita purchasing power parity. That is, “if two countries received equal amounts of cryptocurrencies in centralized services, the country with the lowest PPP per capita would be in the lead.” That will help determine where “regular people are adopting cryptocurrencies the most.”
Cryptocurrency adoption has declined worldwide, with the exception of lower middle-income (LMI) countries such as India, Nigeria and Ukraine, which ranks fifth, according to the report. Those countries, where 40% of the world’s population lives, have been the largest adopters of cryptocurrencies since the second quarter of 2022, when global usage began to plummet:
“This could be extremely promising for the future prospects of cryptocurrencies. LMI countries are often rising countries, with dynamic and growing industries and populations. (…) If LMI countries are the future, then the data indicates that cryptocurrencies will be a big part of that future.”
Central and Southern Asia and Oceania, Central, Northern and Western Europe and North America are grouped as the main originators of transaction value received.
While North America dominated the cryptocurrency market by volume, there was a clear drop in institutional trading volume starting in April. The share of stablecoins in that volume also fell significantly, from 70.3% in February to 48.8% in June. Weighted transaction volume in decentralized finance (DeFi) fell from more than 75% in August 2022 to less than 50% in July 2023.
Central, Northern and Western Europe produced 17.6% of the crypto value received, with the United Kingdom accounting for more than double the volume of second-place Germany. The UK ranked 14th in adoption globally.
Related: UK leads crypto activity in Central, Northern and Western Europe: Chainalysis
However, France led the growth of DeFi. DeFi saw year-on-year growth in Central and Southern Asia and Oceania, Eastern Europe, and Central, Northern and Western Europe in the 12 months ending June 2023.
Central and Southern Asia and Oceania accounted for 19.3% of the crypto value received by exchanges. First-place India surpassed second-place Vietnam by about 100%.
Bans in China dragged down trading volumes in East Asia starting in 2020. However, China produced more than $75 billion in value received by exchanges in the 12 months ending in June, and nearly three Quarters of that amount were handled by centralized exchanges.
The top 10 countries in our 2023 Global Cryptocurrency Adoption Index spanned five continents, but Central and Southern Asia dominated the list. See the rest of the top 20 and learn more about global cryptocurrency usage here. https://t.co/czQb7cXPgn pic.twitter.com/z6FOFvQgzf
– Chain analysis (@chainalysis) September 21, 2023
In the Middle East and North Africa, Turkey saw strong dominance in web traffic to nft sites, and Saudi Arabia led global transaction growth, with a 12% increase. Nigeria surpasses other sub-Saharan countries in transaction volume. That region represents 2.3% of the world volume. bitcoin is most popular in that region, accounting for 9.3% of volume, compared to 4.2% in East Asia.
In Latin America (where Chainalysis places Mexico and Puerto Rico), Argentina and Brazil are the main contributors to transaction volume. The report notes the role of cryptocurrencies in protecting users against inflation in the region.
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