Emerging economies are leading the crypto army to become a global phenomenon, and the share of small countries in the use of cryptocurrencies has surpassed that of the developed world.
According to data from Chainalysis, the global cryptocurrency adoption rate rose 880% over the past year, largely due to P2P transaction activity and the nature of Bitcoin as a worthless business that is not controlled by the government.
Smaller Countries Are More Crypto-Friendly
The global landscape looks very different from last year. According to this year’s Global Crypto Adoption Index, Vietnam, India, and Pakistan are the countries with the highest crypto adoption. Last year, India and Pakistan didn’t even appear on the list, with Vietnam in 10th place.
Russia, Ukraine, and Venezuela – the top performers in 2020 – fell in the rankings. Ukraine fell back to 4th place, Venezuela rose to 7th place, Russia dropped out of the top 10 and fell back to 18th place in the global ranking. China has disappeared from the rankings, which seems logical given the recent legal crackdown on the industry and the country’s progress in CBDC development.
Chainlaysis stated that the increase in P2P transactions in smaller countries is proportional to the interests of China and America, which tend to reduce the overall value of exchanges.
The United States and China’s P2P transaction volume roughly matched the global total until it began to differ in June 2020. At that point, the U.S. and China see their P2P transaction volume shrink as the rest of the world grows. While all three dips dramatically beginning in March 2021, the U.S. and China dip more and remain lower than worldwide totals.
P2P Transactions Pushing Crypto Adoption to the Top
P2P trading is the primary driver of the changes in the Chainalysis ranking. However, the root cause behind this sudden interest in BTC trading could be the global financial crisis and the way it is affecting the most depressed economies.
The report argues that a significant number of countries at the top of the ranking have had to deal with sharp devaluations and accelerated inflationary processes. To counteract this, the population tends to look for assets that function as a store of value, and Bitcoin is the perfect candidate for a good number of people.