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I hope you are all well and had an excellent week, welcome to CryptoGod-1’s blog on all things crypto. In this post I will be looking at the surge of adoption for cryptocurrencies and crypto related products in both South and Central Asia, along with how it has been attributed to the emergence of real-world use case in these nations.
Cryptocurrency Adoption Surge
The regions of South and Central Asia have been experiencing a significant surge in terms of cryptocurrency adoption, with the driving force being the emergence of real-world use cases. This is according to blockchain intelligence firm Chainalysis, who during a recent webinar discussed their 2023 Geography of Cryptocurrency report.
The head of APAC policy at Chainalysis, Chengyi Ong, noted that the growing use of digital assets in countries like India and Vietnam is helping the region to outpace other areas globally. She went on to claim that the adoption trend in the region is primarily fuelled by use cases such as blockchain-based gaming, remittances, and protection against currency volatility.
“Where fundamental drivers are strong and where digital assets have real-world value to offer, adoption will follow in some way, shape or form.”
The webinar was led by Kim Grauer, the research director at Chainalysis, and she noted that the popularity of cricket-themed non-fungible tokens (NFTs) in India had been a particular highlight, while the blockchain game Axie Infinity had been developed by Vietnamese studio Sky Mavis. These examples help to illustrate the innovative use cases and how they bring in a new cohort of users. This turns them into native crypto users and in turn further drives adoption in the region.
2023 Geography of Cryptocurrency report showed how users and crypto adoption has decreased as a whole since its peak back in Q2 2021. The one main exception for this was low-to-middle-income (LMI) countries. This includes nations within the Asia Pacific regions, with the likes of India and Pakistan included. These MLI's account for roughly 40% of the global population and these levels of adoption have not been seen since before the FTX collapse in November 2022.
With the collapse of FTX came a $2 trillion market loss and the the levels of wider cryptocurrency adoption reduced. A host of high income nations decided to respond to the crash with increased regulatory scrutiny. This has further reduced adoption in these nations, allowing LMI's to take centre stage in the race. The report highlights the promising nature of these nations adopting crypto further into their daily lives, and notes how it coincides with growing institutional interest in crypto in high-income countries.
“We could see a combination of bottom-up and top-down cryptocurrency adoption in the near future if these trends hold, as digital assets fulfil the unique needs of participants in both segments."
The Global Crypto Adoption Index measured crypto adoption by considering total crypto activity in a country relative to its purchasing power. This produced a comparative metric and allowed all nations to work from a level playing field for the evaluation of more than 150 nations around the world. It accounted for national income levels and population size and this led to India ranking the highest in the scale. It was closely followed by Nigeria, while a total of eight Asia Pacific nations are included within the top 20.
Have a great day,
CryptoGod-1.
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