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India now ranks second on the global crypto adoption index, according to new research from Chainalysis.

  • Chainalysis has released a new report that claims t he Global Crypto Index shows that cryptocurrency usage is highest in Vietnam, India, and Pakistan.
  • In Pakistan and Vietnam, usage is more similar to gambling, but India is more advanced.
  • India has a greater adoption rate of Ethereum than the other two countries.

Countries in the west and the European Union may lead the globe in crypto legislation, but cryptocurrency usage has exploded throughout Central and Southern Asia and Oceania (CSAO). According to a new survey from blockchain-based analytical firm Chainalysis, the top three countries in the Global Crypto Adoption Index are Vietnam, India, and Pakistan. Thailand and the Philippines, for example, were ranked 12th and 15th on the index, respectively.

The CSAO market is the company's fourth largest cryptocurrency market, with a total value of $572.5 billion forecasted between July 2020 and July 2021. This is 14% of the total transaction value throughout the time period in question. In a blog post, the company claimed that “CSAO's transaction activity surged by 706 percent in terms of raw value compared to last year, and its percentage of worldwide cryptocurrency activity increased by 2%, making CSAO one of the fastest-growing locations we study.”

Crypto adoption surging in India

Furthermore, the Indian and Vietnamese markets are "far larger" than Pakistan's, according to the research. India, Vietnam, and Pakistan all have "strong levels of grassroots cryptocurrency adoption," according to the report, although India has a far higher percentage of activity on Decentralized Finance (DeFi) platforms. In comparison, such platforms accounted for 59 percent of the country's crypto activity, compared to 47 percent in Vietnam and 33 percent in Pakistan.

DeFi expansion could be beneficial to developing countries such as India. These apps leverage technology to make blockchain and crypto-based lending networks, investment schemes, and other services more accountable. As a result, they're more easily accepted by regulators than ordinary crypto trading operations. In July of last year, the US Securities and Exchange Commission (SEC) approved Arca, a crypto-based fund.

While all three regions saw significant growth last year, DeFi adoption increased by 641 percent in India and 711 percent in Pakistan, according to Chainalysis.

Because most DeFi apps today are built on the Ethereum platform, higher DeFi use has also led to increased Ethereum usage in India, as compared to the other two nations in the top three. According to the survey, Indian cryptocurrency adopters appear to be more mature than those in Vietnam and Pakistan.

In India, transaction sizes were greater, with significant institutional transfers of more than $10 million worth of cryptocurrency accounting for 42 percent of all transactions from India-based addresses. In Pakistan and Vietnam, just 28% and 29% of transactions, respectively, were of such high value.