Emerging economies are leading the crypto army on its quest to become a global phenomenon, and smaller countries are already outpacing developed nations in their share of cryptocurrency usage.

According to Chainalysis, the global crypto adoption increased a whopping 880% over the last year, mainly thanks to P2P trading activity and the nature of Bitcoin as a store of value-free from government control.

Smaller Countries Are More Crypto-Friendly

The global landscape looks very different from last year. According to this year’s Global Crypto Adoption Index, Vietnam, India, and Pakistan rank as the countries with the highest rate of cryptocurrency adoption. Last year, India and Pakistan did not even appear on the list, and Vietnam was ranked number 10.

Russia, Ukraine, and Venezuela —the leaders in 2020— slid down in the ranking. Ukraine fell to No. 4, Venezuela moved to No. 7, and Russia dropped out of the Top 10 going all the way down to No. 18 in the global ranking. China disappeared from the ranking, which seems logical considering the recent legal blows against the industry, and the progress the country is making in the development of its CBDC.

Chainlaysis explains that the rise of P2P trading in smaller countries outweighed in proportion to the interest of the Chinese and Americans, who tended to reduce the total value of their exchanges:

P2P transaction volume for the U.S. and China moved roughly in line with the worldwide total until they began to diverge around June 2020. At that point, the U.S. and China see their P2P transaction volume shrink as the rest of the world grows. While all three dip dramatically beginning in March 2021, the U.S. and China dip more and remain lower than worldwide totals.

Cryptocurrency Adoption is Hard To Measure

P2P trading is the primary driver of the changes in the Chainalysis ranking. However, the root cause behind this sudden interest in BTC trading could be the global financial crisis and the way it is affecting the most depressed economies.

The report argues that a significant number of countries at the top of the ranking have had to deal with sharp devaluations and accelerated inflationary processes.

To counteract this, the population tends to look for assets that function as a store of value, and Bitcoin is the perfect candidate for a good number of people.

Many emerging markets face significant currency devaluation, driving residents to buy cryptocurrency on P2P platforms in order to preserve their savings. Others in these areas use cryptocurrency to carry out international transactions, either for individual remittances or for commercial use cases, such as purchasing goods to import and sell.

Chainalysis is always looking for ways to refine its statistics. This year’s methodology changed, and they stopped considering the Number of deposits by country weighted by the Number of internet users.

The firm also created a DeFi Adoption Index to take into account exchanges made through decentralized platforms. This report will be available in the coming weeks.