India ranked second in a list of 20 countries with the highest cryptocurrency adoption rate, according to crypto analysis platform Chainalysis. Vietnam secured the first spot, and Pakistan came third.
(Subscribe to our Today's Cache newsletter for a quick snapshot of top 5 tech stories. Click here to subscribe for free.)
Chainalysis’s 2021 Global Crypto Adoption Index ranked 20 countries to measure the level of cryptocurrency adoption and usage by individuals between July 2020 and June 2021.
Emerging market economies took the top spots due to huge transaction volumes on peer-to-peer platforms (P2P) when adjusted for purchasing power parity per capita and internet-using population, Chainalysis said in a statement.
Global adoption of cryptocurrency grew over 800% in the past year, especially in emerging markets, according to Chainalysis. This indicates that people turn to virtual money to preserve their savings in the face of currency devaluation, to send and receive remittances and carry out business transactions, it added.
Many of these markets limit the amount of national currency that residents can move out of the country. Cryptocurrency gives users as a way to circumvent those limits so that they can meet their financial needs, Chainalysis said.
Also Read | Binance: The crypto giant facing pressure from regulators
On the ranking methodology, Chainalysis ranks countries by their P2P trade volume and weights it to favour countries with lower purchasing power parity (PPP) per capita and fewer internet users to highlight countries where more residents are putting a larger share of their overall wealth into P2P cryptocurrency transactions.
This is why both China and the U.S. dipped in the global adoption index rankings as their P2P trade volume weighted for internet-using population declined dramatically over the year. It also reflects increasing ‘professionalisation’ and ‘institutionalisation’ of cryptocurrency trading in the U.S. , and in China’s case, the ongoing government crackdowns on crypto trading .
