• The Philippines dropped to the sixth position in the Chainalysis Global Crypto Adoption Report, falling from its previous second-place ranking.
• India, Nigeria, Vietnam, the United States, and Ukraine now lead in adoption.
• Lower middle-income (LMI) countries, including many in the Central & Southern Asia and Oceania (CSAO) region, have shown a stronger recovery in grassroots adoption, making up most of the top ten.

Dropping from its previous second-place position, the Philippines now holds the sixth spot in this year’s Chainalysis Crypto Adoption Report, with India, Nigeria, Vietnam, the United States, and Ukraine surpassing its ranking.

The Landscape of Crypto Adoption in the Philippines in the Past Year

With the bear market still ongoing and the collapse of crypto firm FTX in November last year, cryptocurrency adoption in the Philippines has significantly declined over the past year.

In 2022, the country ranked second in the world in terms of cryptocurrency adoption. The top five countries, in order, are Vietnam, the Philippines, Ukraine, India, and the United States.

According to the report, the country received over $8 billion in value in June of the previous year; however, in the same month this year, it dipped to just under $5 billion.

“The Philippines has a huge share of crypto-related web traffic going to gaming and gambling platforms at 20% — Vietnam is next at just 10%.”

Chainalysis

In the Central & Southern Asia and Oceania (CSAO) chapter, the firm shared that they had a conversation with Donald Lim, president of the Blockchain Council of the Philippines.

Lim noted that the Axie Infinity craze sparked cryptocurrency adoption in the Philippines and although its popularity has waned, it laid the foundation for further cryptocurrency adoption, as players now have active wallets.

Accordingly, he stressed that to maintain this momentum, the country requires regulatory support and participation from major web2 companies. Lim also believes the country has the potential to become a cryptocurrency leader in Asia.

“We can become the blockchain capital of Asia. Look at the developer talent, look at all of the online groups devoted to trading and NFTs — it’s just a matter of time.”

Donald Lim, President, Blockchain Council of the Philippines

Highlights from the Chainalysis Report: Stats and Figures

Like the Philippines, Vietnam dropped to third place this year after being ranked first last year. Ukraine, which was ranked third last year, dropped two places to fifth place. On the other hand,  India, which was ranked fourth last year, climbed to the top spot this year while the United States, which was ranked fifth last year, moved up one place to fourth place this year.

The rest of the top 20 countries include the Philippines, Indonesia, Pakistan, Brazil, Thailand, China, Turkey, Russia, the United Kingdom, Argentina, Mexico, Bangladesh, Japan, Canada, and Morocco.

Chainalysis observed a decline in global grassroots crypto adoption, although there has been some recovery since late 2022. However, it remains below its all-time peak. 

Nonetheless, lower middle-income (LMI) countries have experienced notably stronger recovery in grassroots adoption, with most of the top ten countries falling into this category. According to Chainalysis, these LMI countries are home to 40% of the world’s population, which is “extremely promising for crypto’s future prospects.”

A Comparison with Other Countries in the CSAO Region

In addition, the Central & Southern Asia and Oceania (CSAO) region stood out in the Global Crypto Adoption Index, with six of its countries ranking in the top ten—including India (1), Vietnam (3), the Philippines (6), Indonesia (7), Pakistan (8), and Thailand (10). 

Chainalysis emphasized that the CSAO region is particularly noteworthy, as it demonstrates the future potential of cryptocurrency adoption. This is due to the diverse economic needs of these countries, with unique crypto platforms and assets emerging to cater to each of them.

Moreover, within the CSAO region, the report also noted the rise in the prominence of decentralized finance (DeFi), representing more than half of the regional transaction volume in the past year, in contrast to 35% in the prior period. Additionally, institutional adoption in CSAO has seen an uptick, accounting for nearly 70% of the overall transaction volume. This focus is on transfers valued at $1 million or higher, as opposed to less than 60% in the preceding timeframe.

What is the Chainalysis Global Crypto Adoption Report?

The 2023 release is the fourth edition of the Chainalysis Global Crypto Adoption Index. This annual report, conducted by blockchain analysis firm Chainalysis, combines on-chain and real-world data to measure which countries are leading the world in grassroots crypto adoption.

The Global Crypto Adoption Index ranks 154 countries based on their usage of cryptocurrency services. The index consists of five sub-indexes, which assess each country’s usage of different cryptocurrency services. The index uses web traffic patterns to estimate transaction volumes, and is validated by consulting local crypto experts and operators worldwide.

This article is published on BitPinas: PH Ranks 6th in This Year’s Chainalysis Crypto Adoption Report

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