[imagesource:here]

Vietnam, India, and Pakistan are three of the countries showing a quite remarkable uptake in the trading of cryptocurrencies.

The global adoption of cryptocurrencies has risen by an amazing 881% over the past 12 months, and it is good to see developing countries included in this.

Per CNBC, blockchain data firm Chainalysis has released its second yearly batch of data for the Global Crypto Adoption Index.

The index ranks 154 countries according to three metrics: peer-to-peer exchange trading volume, total crypto activity, and trading activity of non-professional users.

All are weighted by purchasing power parity per capita, a popular metric used by macroeconomic analysts that compare different countries’ currencies through a “basket of goods” approach.

In the index, countries are scored on a scale of 0 to 1.

South Africa, for example, has a score of 0.14 whereas Vietnam has a score of 1, India has a score of 0.37 and Pakistan has a score of 0.36:

South Africans are embracing cryptocurrency trading thanks to the rise in trusted investing firms, like Revix, which makes investing in cryptocurrencies and popular crypto bundles very simple.

Chainalysis says the purpose of their index is to capture crypto adoption by “ordinary people” and to “focus on use cases related to transactions and individual saving, rather than trading and speculation”.

Basically, the metrics are weighted to incorporate the wealth of the average person and the general value of money within particular countries.

The Top 20 countries are as follows:

As you can see, there are plenty of emerging economies, like Togo, Colombia, and Afghanistan.

Interestingly, the US dropped from sixth to eighth place, and China went from fourth to 13th, largely as a result of a crackdown on crypto trading in the country.

The reason for the rise of crypto adoption in developing countries, as per Chainalysis, is as follows:

…many residents use peer-to-peer, or P2P, cryptocurrency exchanges as their primary on-ramp into cryptocurrency, often because they don’t have access to centralised exchanges.

The report also says many residents of these countries turn to cryptocurrency to preserve their savings in the face of currency devaluation, as well as to send and receive remittances and carry out business transactions.

According to Boaz Sobrado, a London-based fintech data analyst, the top 20 countries also have capital controls or a strong emigrant and immigrant population in common.

Afghanistan, in turmoil at present, is a good example:

“Afghanistan on top makes sense from a capital controls point of view, given its hard to move money in and out,” Sobrado said.

The correction for purchasing power parity and gross domestic product may also have boosted its placement, given that Afghanistan is one of the world’s poorest countries.

Sanctioned countries, like Cuba, are more difficult to track, though, and could end up being underestimated.

While there is no perfect way to measure per capita global crypto adoption, this index is still the best yet.

[source:cnbc]