The so-called 2020 Global Crypto Adoption Index of Chainalysis reveals that Ukraine leads the global adoption of cryptocurrencies across countries.
This index is an excerpt from the 2020 Geography of Cryptocurrency Report by Chainalysis, released at the end of the month.
It is an analysis using objective parameters, such as adoption rates and crypto usage patterns, to examine how these differ around the world.
In addition, most of the volume of cryptocurrency transactions are due to trading and speculation, while the objective of the index was to measure the actual daily adoption by users.
For this reason, the formula used to calculate the index was weighted to measure cryptocurrency activity, also taking into account the population and size of the economy in each country, with the intention of detecting in which countries most residents have moved most of their funds into the crypto markets.
The Global Crypto Adoption Index consists of four metrics with which 154 countries are ranked. The overall ranking is calculated by taking the geometric average of the ranking of each country and normalizing this number on a scale from 0 to 1. The closer the score is to 1 the higher the degree of adoption.
The four metrics taken into consideration are:
- the value of cryptocurrencies transited on-chain at purchasing power parity (PPP) per capita,
- the value transited on-chain by retail users weighted by PPP per capita,
- the number of on-chain cryptocurrency deposits weighted according to the number of Internet users,
- the volume of peer-to-peer exchanges (P2P) weighted by PPP per capita and number of Internet users.
Finally, if a country scores zero for any of the four metrics, its overall final score is considered zero.
Global Crypto Adoption Index, the ranking
That said, the country at the top of this index, with a value of 1, is Ukraine which, although it is not at the top of any of the four metrics, is in fourth absolute position for transits, seventh for deposits, and eleventh for trades.
In second place, very close, is Russia, with a total value of 0.931.
These first two positions are decidedly curious, both because Ukraine is often almost ignored in this sector, and because in Russia the state still has an attitude not particularly favourable to cryptocurrencies.
In third place, there is Venezuela, with 0.799, while in fourth place there is China with 0.672. These two positions are less surprising, both because Venezuela has major problems with fiat currencies and because China is one of the largest cryptocurrency markets in the world.
In fifth place is Kenya, which even surpasses the USA, ranking only sixth. This is followed by South Africa, Nigeria, Colombia and Vietnam.
It should be noted that for the two transit rankings, China is clearly in first place, while Vietnam is in second place. Since these are per capita values, based on purchasing power parity, these figures are very interesting.
Moreover, out of 154 countries analyzed, only 12 have a zero score, while many developing countries have a high base activity. For example, what is happening in Venezuela is also happening in a vaguely similar way in other countries in Latin America, Africa, or East Asia where there are various problems with fiat currencies.