Lower-middle income countries hold the majority of the positions in the top 20 countries in terms of crypto adoption (Vietnam, Philippines, Ukraine, India, Pakistan, Nigeria, Morocco, Nepal, Kenya and Indonesia):

Vietnam for the second consecutive year is ranked first with 27% of Vietnamese consumers using or owning digital assets. 23% of Vietnamese consumers engage in play-to-earn games, inspiring more crypto gaming start-ups to try to find success in the country, including Axie Infinity. Another driving factor is the high level of remittances, which form 5% of GDP.
Philippines ranked second with 25% of Filipinos engaging in play-to-earn games. Remittances form 9.6% of GDP, a major driving factor.

Ukraine is third. The military conflict with Russia severely disrupted the Ukrainian economy, which explains why residents decided to interact with digital currencies instead of fiat.
India ranked fourth, down two places from 2021 due to the implementation of a steep 30% tax on crypto profits, along with a 1% tax on every transaction.
Pakistan is now the country with the sixth-highest crypto adoption rate, falling three places since 2021 after the Central Bank and the government recommended a complete ban on cryptocurrencies in January 2022.
Nigeria moved down from 5th position in 2021 to 11th position. Nigeria has the highest percentage of population owning crypto at 45% as it enables Nigerians to transact without relying on their underdeveloped financial system. However, it is not as strong when it comes to other areas such as centralised retail transactions, DeFi, institutional adoption and has low purchasing power compared to other countries.
Morocco was not in the top 20 in 2021, however ranked 14th in 2022 amid a ban. Since then, the Central Bank of Morocco has partnered with the IMF to regulate the use of cryptocurrencies helping to lift this ban. With this regulation in place, Morocco could easily break into the top 10 in 2023.

Several upper-middle-income countries, such as Brazil, Thailand, Russia, China, Turkey, Argentina, Colombia and Ecuador, made it to the list.
Latin America, Brazil (7th), Argentina (13th), Colombia (15th), and Ecuador (18th) made the list due to high inflation rates in these countries. For instance, in Argentina, the year-on-year inflation rate was 79%. This situation has driven many people to seek alternative stores of value, such as cryptocurrencies. Stablecoins have become particularly popular due to their pegging status.
Russia’s invasion of Ukraine caused financial and economic sanctions that resulted in the fall in value of the Russian ruble. As a result, many Russians converted rubles into cryptocurrency to avoid sanctions and currency depreciation. Additionally, Russia has taken advantage of crypto to fund its invasion.
China re-entered the top ten after ranking 13th in 2021. This is surprising given the Chinese government’s ban on all cryptocurrency trading. The relatively closed financial system in China has driven citizens to crypto as an alternative store of value.

The United States and the United Kingdom are respectively 5th and 17th in the index and the only high-income countries featuring.
United States ranked fifth overall, despite ranking in the top three of all categories except for population and purchasing power-adjusted P2P exchange. The US is a hotspot for crypto-related companies, including crypto providers like Coinbase and Kraken. Moreover, crypto-friendly laws are in place in a majority of the states, driving up adoption rates.

United Kingdom has the sixth-largest crypto transaction value in the world. Due to regulatory and taxation certainty, the UK was the only top-five Western European country that increased on-chain transactions each quarter.

In conclusion, the Global Crypto Adoption Index 2022 reveals emerging markets are leading crypto adoption. While high-income countries such as the United States and the United Kingdom still rank within the top 20, the adoption rates in emerging markets like The Philippines, Brazil and Russia are rapidly increasing. The reasons for this adoption vary from country to country, ranging from protection against inflation and currency depreciation, war fundraising and to the underdevelopment of traditional financial systems. El Salvador has already adopted Bitcoin as legal tender and other countries such as Venezuela and Iran are also exploring the use of digital currencies as a way to mitigate economic issues such as inflation and sanctions. It is clear that cryptocurrencies are no longer just a niche technology. With more regulatory clarity and institutional adoption, we can expect to see even more growth in the crypto industry in the coming years.