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The 2020 Global Crypto Adoption Index: Cryptocurrency is a Global Phenomenon

This blog is an excerpt from the Chainalysis 2020 Geography of Cryptocurrency Report. Click here to download the whole thing! You can also view the Global Crypto Adoption Index in its entirety on Chainalysis Market Intel.


Cryptocurrency adoption continues to grow around the world. But aside from anecdotal evidence, there haven’t been many objective measures of how rates of adoption and usage patterns differ around the world. That’s why we created the Global Crypto Adoption Index. Our goal is to quantify the differences in adoption between countries across the globe.

However, we wanted to do more than just report the countries trading the most cryptocurrency. Most cryptocurrency volume moved reflects trading and speculation carried out by professional or, increasingly, institutional investors moving large sums. While trading and speculation are important to the cryptocurrency economy, we wanted our index to emphasize grassroots adoption by everyday users. After all, any long term speculation on cryptocurrency is likely predicated on the idea that cryptocurrency can become a mainstream means of value transfer and, eventually, payments. Our index is meant to show which countries are leading the way toward that eventuality.

To do this, we weighted our index formula to measure cryptocurrency activity while also accounting for each country’s population and economy size. The intention is to highlight the countries where the most residents have moved the biggest share of their financial activity to cryptocurrency. Below, we’ll explain our index methodology in more detail, show you the top ten countries on the index, and share a few key takeaways.

Our methodology

The Global Crypto Adoption Index is made up of four metrics, which we’ll explain in detail below. We rank all 154 countries according to each of those four metrics, take the geometric mean of each country’s ranking in all four, and then normalize that final number on a scale of 0 to 1 to produce the overall rankings. The closer the country’s final score is to 1, the higher the rank.

Here are the four metrics that make up each country’s final score in the Global Crypto Adoption Index:

On-chain cryptocurrency value received, weighted by purchasing power parity (PPP) per capita

The goal of this metric is to rank each country by total cryptocurrency activity, but weight the rankings to favor countries where that amount is more significant based on the wealth of the average person and value of money generally within the country.

We calculate the metric by estimating total cryptocurrency received by that country, and weighting the on-chain value based on PPP per capita, which is a measure of the country’s wealth per resident. The higher the ratio of on-chain value received to PPP per capita, the higher the ranking, meaning that if two countries had equal cryptocurrency value received, the country with the lower PPP per capita would rank ahead.

On-chain retail value transferred, weighted by PPP per capita

The goal of this metric is to measure the activity of non-professional, individual cryptocurrency users, based on how much cryptocurrency they’re transacting compared to the wealth of the average person. We approximate individuals’ cryptocurrency activity by measuring the amount of cryptocurrency moved in retail transactions, which we designate as any transaction for under $10,000 USD worth of cryptocurrency. We then rank each country according to this metric but weight it to favor countries with a lower PPP per capita.

Number of on-chain cryptocurrency deposits, weighted by number of internet users

The goal of this metric is to rank countries based on whose residents are carrying out the highest number of cryptocurrency transactions. We measure this by taking the ratio of on-chain cryptocurrency deposits to the country’s total number of internet users. The higher the ratio, the higher the ranking, meaning that if two countries had an equal number of deposits, the country with fewer internet users would rank higher.

Peer-to-peer (P2P) exchange trade volume, weighted by PPP per capita and number of internet users

Unlike our other three metrics, P2P trade volume isn’t expressed on blockchains, but still makes up a significant percentage of all cryptocurrency activity, especially in the developing world. We rank countries by their P2P trade volume and weight it to favor countries with lower PPP per capita and fewer internet users, the goal being to highlight countries where more residents are putting a larger share of their overall wealth into P2P cryptocurrency transactions.

Our tools can’t capture P2P trade volume because it isn’t recorded on the blockchain — all we can see are funds entering or leaving P2P platforms. Instead, we rely on data supplied by two of the largest P2P platforms operating — LocalBitcoins and Paxful — to calculate each country’s P2P trade volume. While this means that we aren’t capturing all P2P value, we believe these two exchanges are popular enough for their metrics to act as an overall approximation. We will likely need to update this portion of the formula to account for the rise of other P2P platforms, such as that offered by Binance, whose popularity is growing.

We rank all 154 countries according to each of the above four metrics, then take the geometric mean of the four metrics for each country, and normalize that final number on a scale of 0 to 1 to produce the overall rankings.

How we estimate country-level cryptocurrency transaction value

Due to cryptocurrency’s decentralized nature, it’s impossible to know the precise amount sent and received on-chain by addresses in a specific country. However, we can produce a strong estimate by measuring the cryptocurrency activity occurring on each platform and distributing it by country based on the breakdown of countries accounting for web traffic to each platform’s website. We use the web analytics service SimilarWeb for those country-based web traffic numbers. We also consider time zone analysis of platforms’ cryptocurrency activity, most popular fiat currency pairs, website language options, and headquarters location to further refine our country-level analysis.

P2P transaction value is assigned to countries based on the fiat pairs involved in transactions. We only apply web traffic data to P2P transaction value for activity conducted with fiat currency used in multiple countries, such as the Euro.

Other notes on methodology

Because of the way geometric means are calculated, any country scoring zero in any of the four metrics would be scored at a 0 for its overall index score. While this doesn’t necessarily mean those countries have no cryptocurrency activity, it indicates that they likely have very little, so we rank those countries last on the index with a ranking labeled “Among lowest” of the 154 countries. For transparency, the countries ranked among lowest for this reason are:

  • Afghanistan
  • Algeria
  • Cape Verde
  • Chad
  • Fiji
  • Laos
  • Libya
  • Mongolia
  • Tajikistan
  • Turkmenistan
  • West Bank and Gaza
  • Zimbabwe

We acknowledge that there are clear limitations to this methodology, including the usage of VPNs and other products that can mask the geographic origin of web activity. However, the data that forms the trends we explore comprises millions of transactions, so this activity would need to be extremely widespread for it to meaningfully affect our data. That’s one reason we vetted our data with experts in each of the geographic regions we cover, including many who are not quoted in the report itself. While experts sometimes had differing explanations for what accounted for certain data points, virtually none of them were surprised by the data itself. Nearly all of our findings aligned with their experience as on-the-ground operators or regional observers. This methodology represents one of the first ever attempts at a comprehensive country-level breakdown of global cryptocurrency activity. We’ll continue to tweak the methodology and share updates as we refine it.

You can sign up for Chainalysis Market Intel here to view the full index in both map.

Key takeaways from the top ten

Three things jumped out at us most after calculating the index and analyzing the top ten countries represented.

Cryptocurrency is truly global. Of the 154 countries we analyzed, only 12 had so little cryptocurrency activity that we gave them an index score of zero. That’s a testament both to the excitement around cryptocurrency as an investment and, especially in the developing world, as a means of value storage and medium of exchange.

Developing countries have high grassroots cryptocurrency activity. Venezuela represents an excellent example of what drives cryptocurrency adoption in developing countries and how citizens use it to mitigate economic instability. As we analyze in-depth later in the report, our data shows that Venezuelans use cryptocurrency more when the country’s native fiat currency is losing value to inflation, suggesting that Venezuelans turn to cryptocurrency to preserve savings they may otherwise lose. We also see this pattern in other Latin American countries, as well as Africa, East Asia, and elsewhere. Our data and interviews also suggest that some residents in many developing countries use cryptocurrency to carry out commercial transactions.

P2P platforms are essential to adoption in developing countries. The top four countries for P2P cryptocurrency activity weighted by number of internet users and PPP per capita all appear in the Global Crypto Adoption Index’s top ten, and all four are developing countries. This illustrates how important P2P platforms are to cryptocurrency adoption in the developing world. As cryptocurrency observer and data scientist Matt Ahlborg explores here, P2P platforms don’t custody any of the cryptocurrency or fiat traded on their platforms, meaning they don’t have to connect to the banking system and face fewer regulatory hurdles. This allows them to onboard residents of developing countries more easily, many of whom are excluded from the traditional financial ecosystem.

Click here to go to Chainalysis Market Intel, where you can get an interactive map of the Global Crypto Adoption Index, as well as the full list of country rankings.

Want more insights into how cryptocurrency usage differs by region? Click here to download the full Geography of Cryptocurrency Report! You’ll get more original data and research on inter-regional trading patterns, the state of crypto crime by region, how cryptocurrency mitigates economic instability in the developing world, and more!