A recent Chainalysis publication places Russia and China above the US in terms of cryptocurrency adoption, with Ukraine leading globally
Cryptocurrency data analysis company Chainalysis has published an index that tracks the adoption of cryptocurrencies in countries around the world.
Ukraine is a global leader in terms of cryptocurrency adoption, according to the Global Crypto Adoption Index 2020. Russia comes in second, despite the country’s strict regulatory stance on cryptocurrency. Venezuela is in third place, as the country’s residents turn to cryptocurrencies to contain the hyperinflation that affects their local currency.
The United States comes in sixth, behind Kenya, China, Venezuela, Russia and Ukraine. The Chainalysis index analyzed three metrics in the chain, which are the value of retail transfers in the network weighted by per capita power (PPP), the total value of crypto transactions in the chain weighted by PPP and the number of cryptocurrencies in the chain deposits weighted by the number of Internet users in a country.
The index also considered other factors, such as the volume of trades executed on cryptocurrency exchanges point to point (P2P) in relation to the number of Internet users in a country and their PPP.
There are several levels of development across the cryptocurrency space from one country to another. For example, the per capita weighting classification method has seen China perform poorly in terms of network deposits and P2P trade due to its huge population. This metric dragged China to fourth place, despite the country leading in terms of rankings in the chain by retail and total value.
According to Chainalysis, Venezuela is a perfect example of the forces that drive the adoption of cryptocurrency in developing countries. The company highlighted the use of crypto among ordinary Venezuelans as a way to mitigate the current economic instability. The data show that Venezuelans turn to cryptocurrencies to preserve their wealth, as they can lose it by saving with their local fiat currency.
No Western European country in the top ten
There are some surprises in the report as well. No Western European country is ranked in the top ten in cryptocurrency adoption in the world. The UK, France, Germany, Switzerland and other leading European countries are all missing from the list.
Meanwhile, Vietnam comes in second place for the value of both retail and all transactions on the network. This is despite the government’s first attempts to ban cryptocurrency transactions in the country. Among the 154 countries covered, Afghanistan, Algeria, Cape Verde, Chad, Fiji, Laos, Libya, Mongolia, West Bank and Gaza, Tajikistan, Turkmenistan and Zimbabwe are among the lowest for transparency reasons.