Chainalysis Says Cryptocurrency Acceptance Index Gains 880% Over Year
Chainalysis analysts yielded statistics on the Global Digital Currency Adoption Index. The total growth was more than 880%, and the leaders of growth among the countries were India, Vietnam, and Pakistan.
The main purpose of the statistics was to track the highest level of acceptance of digital currencies. The Chainalysis Acceptance Index consists of 3 main indicators. Based on them, 154 countries were ranked. Then the geometric mean of the rating of each one country is taken and the concluding rate is from 0 to 1. Naturally, if the country is very close to 1, the higher rating it gets.
Among the three indicators:
- Received price of digital currency, weighted by purchasing power parity (PPP) per capita
- On-chain retail price carry-over, weighted by PPP per capita
- Peer-to-peer (P2P) trading volume, weighted by PPP per capita and number of Network clients
Chainalysis noted that digital currency adoption has increased by more than 2,300% since Q3 2019 and higher than 880% over the past year. The reasons for the growth vary primarily by country and region. The statistics also took into account developing countries, which are using a new asset class to protect against the devaluation of traditional money, as well as for cross-border payments. When it comes to adoption in Western Europe, East Asia, and North America, it is mainly associated with an emphasis on institutional investment.
Analysts have identified three main trends of 2020-2021 period:
The adoption of digital currencies confidently strides the planet
In this graph, they summarized the index numbers of 154 countries for every quarter since Q3 2019. In the Q2 of 2020 end, after the growth of cryptocurrencies, the mass adoption was 2.5, starting from the indices. By the end of the second quarter of 2021, the total score of the indices was 24, which demonstrates just insane growth.
P2P Platforms impact on Growth in Adoption
Kenya, Vietnam, Venezuela, and Nigeria have taken the leading positions in the index due to the huge volume of transactions on P2P platforms. Basically, citizens of these states use digital currencies due to the lack of passage to centralized exchanges.
At the same time, the counties with emerging markets accounted for a huge amount of Internet traffic to the sites of P2P platforms. Latin America, Africa, as well as Central Asia and South Asia sent these platforms many times more traffic than the larger economies of the world, such as East Asia and Western Europe.
Due to them, P2P services received an impressive share in the whole amount of transactions, consisting of payments for amounts less than 10,000 in the equivalent of digital currency.
China and the United States are losing ground
In 2020, China took 4th place in the adoption index table. At the same time, the United States came in 6th. Today they got 13th and 8th place, respectively.
The main reason for this was the drop in the P2P trading volume rating. Thus, China dropped in this aspect from 53rd place to 155th, and the USA got 109th place instead of 16th.
What will be the next reason for global adoption?
Chainalysis concluded that the adoption has grown in developed countries thanks to the significant growth of DeFi and the expanding quantity of transactions for centralized services, while P2P has been actively helping to spread the new asset class in developing countries.
One way or another, the obvious conclusion suggests itself from all of the above. Despite all the obstacles on the way, volatility, and open hostility of almost all regulators of the largest states, cryptocurrencies have managed to become a global phenomenon and their adoption is only growing.