Report: Global Crypto Adoption Up 880% in Past Year

August 20, 2021, 11:00 AM AEST (updated August 23, 2021)

For those paying attention, it is self-evident that crypto has taken off over the past 12 months. Few, however would have predicted the sheer extent and velocity of adoption. According to a recent Chainalysis report, global adoption is up an incredible 880 percent over the past year.

Crypto adoption over past 12 months. Source: Chainalysis

Top 20 Countries Identified

Overall, Vietnam emerged as the clear leader in crypto adoption. It is worth noting that most of the eager adopters are developing nations, suggesting that crypto’s use case is perhaps more readily understood in such regions.

Top 20 in crypto adoption: Chainlysis

Three main trends were identified in the report.

Trend 1: Global Crypto Adoption is Skyrocketing

Adoption has truly skyrocketed since the beginning of 2020, as reflected in the quarter-by-quarter growth chart below. Interestingly, the report notes that the reasons for adoption differ around the world.

Emerging markets tend to turn to crypto to preserve their savings in the face of currency devaluation, send and receive remittances, and carry out business transactions. By contrast, in developed markets, it is driven more so by institutional investment.

Crypto adoption, quarter by quarter. Source: Chainalysis

Trend 2: Emerging Markets Embrace P2P Platforms

Several countries in emerging markets, including Kenya, Nigeria, Vietnam and Venezuela, rank high largely due to enormous transaction volumes on peer-to-peer (P2P) platforms (adjusted for purchasing power per capita and internet-using population). The primary reason for doing so is that they often lack access to centralised exchanges.

Trend 3: China and US Dip in Rankings

Last year, China ranked fourth while the US ranked sixth. This year, the US ranks eighth while China ranks 13th. The main reason for both dropping is that their P2P trade volume weighted for internet-using population declined dramatically – China from 53rd to 155th, while the US fell from 16th to 109th. China’s decline is no doubt linked to regulatory clampdowns over the past six months in particular.

Crypto Gone Mainstream

In years to come, 2020 may well turn out to be the year that crypto went mainstream. Following a sharp correction in March along with other growth assets, crypto picked up steam towards the second half of 2020 and officially became entrenched in mainstream consumer consciousness.

It’s not just ordinary investors taking charge, as a recent survey by Fidelity Digital Assets revealed that 70 percent of institutional investors are interested in buying cryptocurrencies in the near-term. In addition, a 2021 survey of financial advisers found that 26 percent will recommend crypto to their clients within the next year after half had clients who had inquired about crypto in the preceding six months.

Retail investors initially led the charge and institutional investors followed suit, pushing crypto to new highs. Financial advisers lacking insight into the digital asset space run the risk of falling behind. In the past, it might have been a career risk to advocate crypto exposure to one’s clients. In the near future (or perhaps even now), it may be a career risk not to.

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