Global Crypto Adoption Index: Chainalysis sheds light on the cryptocurrency market

The new report titled “Global Crypto Adoption Index” by Chainalysis takes a snapshot of the cryptocurrency market with a focus on Europe and Italy. 

Chainalysis’ research of the cryptocurrency market landscape

Chainalysis has accustomed us to interesting insights into the spread of crypto in the world or parts of it by analyzing state by state and comparing macroregions so as to outline trends.

Trends in cryptocurrency adoption are not only analyzed from a geographic point of view but also under study are the dynamics behind such growths or declines and the causes behind them.

Chainalysis with the Global Crypto Adoption Index this time focuses more on Western Europe, including Italy.

The cryptocurrency world has always found a home, mainly in certain places on earth, those where a combination of ad hoc laws, open-mindedness, commerce, and vision converge in the use of these types of currencies.

The most crypto-friendly places certainly include South America, Eastern countries, and the United Arab Emirates (UAE).

The first place in this special ranking, however, goes precisely to Central, Northern, and Western Europe, which, like last year, confirms its position as the largest crypto-economy on the planet.

In the period from July 2021 to June 2022, the old continent boasts as much as $1.3 trillion in total trade.

The European Union includes five of the largest markets to use digital currencies, which are Germany (21st place), France (32nd place), Spain (34th place), Portugal (38th place), and the Netherlands (39th place).

If we extend our gaze to the entire continent, we can also add to the special club above the United Kingdom, which despite the gale raging through its economy, records an excellent 17th place in the world.

The year-on-year on-chain has grown by 30% when we look at 2021/2022.

Particularly in Ireland and Norway, where the NFT world accounts for 70% of DeFi, while in Italy and Spain, it is gaming that is driving the development of the cryptocurrency market, with over 30% of the traffic taking place in the metaverse.

In Central Europe, above all, the contrasting performances of Germany and the Netherlands, allied in finance but far behind in DeFi, stand out. And the crypto market, since the former grew in this asset by 47% while the latter is bringing up the rear in growth with a step back by as much as 3%.

The German performance, according to Chainalysis, probably stems from the free tax introduced on long-term capital gains and the ability of different types of asset managers to invest in cryptocurrency.

The report’s findings indicate that these are the motivations behind German exploit for both retail and apex investors, while the Netherlands pays for poor virtuosity and high costs.

Smaller countries, on the other hand, have experienced greater performance; Estonia, for example, has been very virtuous, growing by 76% since 2021, while despite Malta having halved its attractiveness blamed on its UAE neighbors, it remains among the most attractive Hubs on the entire continent.

The small Mediterranean country suffers from the proximity of Abu Dhabi and Dubai but also from fierce competition from the Bahamas and Bermuda, but it is still the most important blockchain island in the Mediterranean and boasts one of the most detailed and comprehensive regulatory frameworks in the world.

Estonia continues its drive to become a strategic crypto hub by implementing control over money laundering, ransomware, and cryptocurrency market contagion risks.

Italy’s role within the cryptocurrency market.

The success of this asset in the old continent is mostly due to DeFi and NFTs that drive the interest of investors and enthusiasts, especially first-time entrants.

International investors, on the other hand, unlike the common user, mostly look at security, scalability, and regulatory framework that, in the European case, is among the best in the world thanks to the cryptocurrency travel rule and MiCA. 

In the beautiful country of Italy, digital currencies have grown 23% in the last year, demonstrating a great desire for cryptocurrency and financial freedom on the part of citizens.

Italy’s figure is of great account if we think that it is even higher only than Germany and Spain and brings it to be the sixth market in the continent for cryptocurrency and just outside the special ranking of the top 50 in the world (51st place).

In particular, Italians get a foothold in this asset through blockchain gaming and the metaverse (more than 30% of web traffic in the peninsula is due to this).

The U.K. drags Europe down

The U.K., which is 17th in the rankings compared to last year, a year in which it held position 21, is the largest DeFi district in Europe, and holds the top position among countries on the European continent and 6th in the world by volume with $233 billion in crypto value year-on-year.

Driving success across the Channel are cryptocurrency lending and the NFT market to the tune of 20%.

The strength of the U.K. cryptocurrency market denotes great resilience from the winds of the classical economy and the macro environment, and cryptocurrency adoption rates were more resilient than elsewhere in Europe.

Dion Seymour, technical director of Crypto and Digital Assets at Andersen LLP and former policy advisor at HMRC, the U.K. tax authority, said the following in the report:

“I would like to think that it is because we have tried to provide certainty regarding the regulation of cryptocurrencies

and UK taxation.

Nobody wants cryptocurrencies to get taxed, but if there is uncertainty about how it will be taxed, that can cause a certain level of nationwide cost.

Consumer protection must absolutely be considered if we

they want DeFi to go mainstream. We will continue to see many conversations between policy makers, this year the World Bank, the World Economic Forum, the OECD, the HMT, the FCA and of course the HMRC. “

Conclusions on current cryptocurrency market data

While the appeal of Non-fungible tokens is driving DeFi in the center, north, and Western Europe, the rest of DeFi is leading the way in the West.

The picture painted by Chainalysis’s report basically outlines a virtuous Europe that is open to cryptocurrencies thanks in part to the recent MiCa and the opportunities this asset continues to offer in a world filled with turmoil and lashed by winds of war in Eastern Europe itself.

The old continent confirms itself as the world’s strategic hub as well as the largest cryptocurrency market.