From the outside looking in, it can look like the crypto world is quite small. With only a small percentage of the world actually working in the crypto industry, it can seem like cryptocurrency adoption is the same no matter where you are on the globe. The reality, though, is that the crypto universe is quite vast and spans dozens of industries across almost every continent. With more companies onboarding into blockchain technology and so many use-cases for the tech, there is a lot of diversity in terms of how some parts of the world are adopting cryptocurrency over others. In this post we’ll take a look at how several nations are adopting crypto and blockchain and discuss which nations are ahead of the curve in terms of widespread adoption.
There are several indicators that experts in the field use to determine how quickly cryptocurrency is being adopted on a mass scale, and in what geographies and industries it is being adopted the most. Some of those key indicators include government support, integration with global financial giants, the number of cryptocurrency wallets being opened, the number of transactions being made on blockchain technology, and the expansion of blockchain use-cases into new markets.
One of the best indicators that cryptocurrency is being adopted quickly in a nation is whether or not its government is welcoming to the technology. Several nations such as El Salvador and The Central African Republic have welcomed cryptocurrency with open arms by adopting cryptocurrencies like Bitcoin as legal tender—meaning they can be used for payments throughout the nation. Other nations such as The UAE, Singapore and Switzerland have worked to position themselves as global cryptocurrency hubs by welcoming in blockchain-based companies and businesses with things like tax incentives and government support.
African Nations have largely embraced cryptocurrency and Decentralized Finance (DeFi) as it shows potential for helping the millions of unbanked people around the continent. Among the developing nations of the world, Sub-Saharan African nations are among the fastest-growing cryptocurrency markets in the world. Nations such as Kenya, Nigeria and South Africa are frequently credited as being some of the most cryptocurrency friendly nations, while other news outlets have named Africa the “crypto continent” when covering its many blockchain startups and cryptocurrency businesses.
While many people in places like the United States remain skeptical of the potential for cryptocurrency, its major banks and financial institutions have worked to make crypto more widely available within their systems. Banks like Wells Fargo, CitiBank and Barclays are among just a few of the world’s major financial structures that have gone on a hiring spree for talent in the crypto space. This is a key indicator in the potential for the cryptocurrency market, as banks and major corporations appear to be making major investments in the potential for the blockchain space.
In the United States, major financial structures have also begun offering cryptocurrency options as investments in the U.S. Stock Market. Several cryptocurrency ETFs and IRAs have emerged, giving Americans the ability to invest in cryptocurrency through their investment portfolios and 401ks. While this concept doesn’t really embrace the true potential for cryptocurrency and decentralized finance, it does signal an increase in market adoption among traditional financial structures.
While cryptocurrency adoption from major institutions is a good signal that the market as a whole is being widely introduced to the global public, it isn’t a good indicator of how much cryptocurrency is being used for its intended purpose. The key way to measure the actual adoption and use of cryptocurrency among the general public is to monitor how many new cryptocurrency wallets are being opened, and how many blockchain transactions are being mined or verified on a network.
Estimates show that around 18.36 million new Ethereum addresses were created in 2021, counting only the addresses that held a balance greater than zero throughout the year. The network has become a popular platform for trading NFTs, with markets like OpenSea dominating the NFT market across all blockchain networks. Ethereum also processed a total of around $11.6 trillion equivalent in transactions in 2021, meaning it handled more transactions than all of Visa, the world’s largest payment processor.
As blockchain startups and cryptocurrency exchanges handle more traffic, they become more valuable. 2021 saw an increase in partnerships and brand activations related to cryptocurrency and blockchain unlike ever before. Miami’s basketball arena was officially renamed the FTX Arena in 2021 after the cryptocurrency exchange purchased the naming rights, while it was announced in November 2021 that LA’s Staples Center would be getting renamed to the Crypto.com Arena in the next couple of years.
Other brand activations from companies in other industries within the metaverse signal a shift into blockchain across various industries. Music and fashion industry partnerships with metaverse companies, branded NFT projects and other blockchain startups signal the mass adoption of cryptocurrency and new use-cases for the technology. Where cryptocurrency once existed on the fringes of society it is now front and center, demonstrating use-cases in industries that will introduce new consumers to the crypto market.
Growth in both the amount of new cryptocurrency wallets being opened and the amount of cryptocurrency transactions being confirmed on various blockchain networks signal major adoption around the globe. New users in the space have found use-cases for blockchain projects that have enabled them to earn a living in new ways.
In developing nations, players of an Ethereum-based NFT game called Axie Infinity have been able to earn real money from playing a play-to-earn game on the network. Many have even been able to cover living expenses by playing the game. This shows that not only are brands and major institutions waking up to the potential for cryptocurrency, but so are individual users. Of the nations that have embraced cryptocurrency, those in Southeast Asia and throughout Africa have emerged as several places with the fastest rate of cryptocurrency adoption globally.
Throughout African nations, factors that drive the user base in the cryptocurrency market are things like the ability to do P2P transactions, independence from banks, and as a form of wealth management. Africa’s cryptocurrency market remains strong, even after seeing a sharp increase in adoption throughout 2021. Even in a potential bear market, experts estimate that adoption will continue to increase as more blockchain companies pour into Africa, and as more individuals adopt cryptocurrency as a new financial opportunity.
The CV VC 2021 Africa Blockchain Report describes the overall state of cryptocurrency in the continent as it stands today. The report outlines regulatory changes, adoption signals within the African market, and emerging challenges and roadblocks that must be addressed moving forward. The report also mentioned 3air, describing its role in widespread blockchain adoption throughout African nations. Two key factors that were mentioned in the report are the utilization of new blockchain business models, as well as the implementation of consumer education that can help onboard users into the Web3 space.
3air is working to address these two factors by introducing new opportunities for cryptocurrency and NFTs in emerging markets. Throughout Africa, the implementation of NFT internet subscriptions will function both as an introduction to cryptocurrency and onboarding method for new users in the coming years. Beyond that, education through the real-world deployment of service centers and resources on the ground will help users onboard into the space in new ways.
As we look toward the future of the African cryptocurrency market, the opportunities and excitement make the continent one of the most exciting places to watch as blockchain grows in the coming years. Many see blockchain as an opportunity to drive equity between Africa and more developed continents such as Europe and North America, while others see the crypto space as an opportunity to bring Africa into the fold as one of the world’s most powerful continents.