As we’ve seen all too clearly, the cryptocurrency markets haven’t been in any way immune to the troubles which have beset the world politically and economically this year, as we pass through a time of major disruption globally.

TradFi & Crypto

The good news in crypto is simply that we continue to see institutions from traditional financial and technology services engaging with and moving into crypto.

We’ve recently covered some big players stepping up to the web3 plate, both in the mainstream media and of course, from financial institutions such as The Nasdaq and SWIFT. We’ve also seen coming into 2022 a huge rise of investment from major entities such as Google, Paypal and Morgan Stanley.

Individual Investors

When it comes to individual users of crypto across the globe, we have seen adoption growth level off during this latest bear market which has now lasted for two quarters. Compared with institutional investors, individual retail investors are on average going to be less immediately resilient to worsening macro conditions like the cost of living, and so this is no real surprise.

What is reassuring is that growth has not really become negative, and that many who invested during the bull market have not exited their positions.

Which Countries Are Well Established in Crypto?

When it comes to considering adoption globally, we could look at individual investors, but we can also consider governments’ policies and approaches.

Let’s first look at which countries are already the most established in their use of cryptocurrency.

A simple measure for this question would be just crypto ownership, that is the percentage of a country’s population who own some kind of cryptocurrency. We can take tripleA’s recent report on this as highly accurate, and with detailed factsheets available on every country listed, it’s worth a read.

The report estimates a global crypto ownership base of 320 million or 4.2% of the world’s population, and an increase in crypto use over recent years very similar to the rate of increase in Internet use during the 1990s.

Whilst the USA is ahead of the rest of the world in sheer numbers, with 46 million crypto hodlers, that only makes up 13.7% of its population and puts it in third place percentagewise.

Vietnam leads the way with a stonking 20.3% of its population using crypto. This is interestingly largely due to a lack of cryptocurrency taxation and regulation under its current laws, allowing for individuals to invest more easily.

Institutions are actually banned from transacting in crypto in Vietnam, but these are the only real restrictions on its use. With the state bank now looking into regulation and government strategy on crypto taking shape, these conditions may still change fast before too long.

Between the two in terms of crypto usage is Ukraine in second place, whose relationship to crypto was already strong prior to Russia’s invasion but which has redoubled during the war, as banking infrastructure has been hit hard and crypto has proven an excellent tool both for the Ukraine government itself, and for fundraising to support those affected.

As reported in the Financial Times back in the Spring, Ukraine had raised over $100 million in cryptocurrency donations.

Which Countries Are Coming in Fast to Crypto?

Following a different metric aimed to chart individual growth in crypto usage, is the 2022 Global Crypto Adoption Index recently published by Chainalysis.

This fascinating report has changed its metrics for this year, and now takes account not only exchange transactions at CEX weighted by countries’ purchasing power per capita, but also factors such as peer-to-peer exchange volume, and values from DeFi protocols.

The findings again put Vietnam as the fastest moving in crypto adoption (for the second year running), with the Philippines hot on their tail, and Ukraine, India and the USA taking up the next three spots.

The rest of the top ten are quite intriguing, with Pakistan, Brazil, Thailand, Russia, and China making up the group. This is despite China’s total ban on cryptocurrency trading back in September of 2021.

An essential element in all this is the uptake of cryptocurrency by emerging markets, which will come with many unique challenges and opportunities and is deserving of a write-up all of its own.

A positive finding of the report is that global adoption remains well above where it was in late 2019 preceding the last major bull run.

The question of how many new investors from the last bull cycle stick around through the bear will be a significant factor in determining how strong the next bull run will be, and in turn the trajectory for the whole cryptocurrency market.

As such, this factor alone may be critical to crypto’s outlook in the immediate term.