chainalysis crypto adoption

Bitcoin Is Going Through the Roof in Argentina While the Government Imposes New Taxes

11/12/2020 by Idelto Editor

Argentina’s Senate approved an extraordinary one-time wealth tax to fight the coronavirus pandemic by seeking to boost government revenue and targeting millionaires with assets of more than 200 million pesos ($2.5 million). At the same time, the country still faces a 35% inflation.

Argentinean Senate Approves New Taxes, While Bitcoin Keeps Skyrocketing Against the Argentine Peso

According to El Pais, the measure, citing opposition parties’ statements, could “slow down the investments” in a country whose fiat currency, the Argentinean Peso (ARS) is highly devalued against bitcoin (BTC). The law aims to tax between 1% and 3% of the wealth of taxpayers.

As of press time, BTC/ARS is hovering around the 1,500,850 level, off from the 1,594,196 area (all-time high) reached early December 2020. It is worth noting that this price is not based on the parallel dollar (known as “blue dollar”) that circulates in Argentina, but the official dollar price.

Back in July 2019, BTC was trading at 491,000 ARS, yielding over 185% in a single year so far. If the quotation is made with the blue dollar, bitcoin is currently treading waters at 2,712,438 ARS, according to local exchange Ripio.

The parallel dollar is the only free exchange rate governed by supply and demand forces in the country. Although its purchase and sale in the country are illegal, the surging of the quotation is related to the depreciation of the ARS: a currency that faces economic troubles, inflationary turmoil, oversized emissions, and hopeless forecasts from experts, giving enough room to BTC to surge across the board.

On December 5, 2020, a Bloomberg report noted that the gap between the official and market-based exchange rates narrowed since October due to the government’s adoption of more “orthodox measures to boost exports.”

Is This the End of the Argentinean Peso in the Latin American Nation?

This is given in the context of the recent stance from the Director of the Central Bank of Argentina (BCRA) on fiat, Carlos Hourbeigt, who stated in a recent presentation before the Argentine Chamber of Fintech that “the common enemy is the cash.”

He has been promoting “Transferencias 3.0,” an upcoming national payments network that aims to replace the Argentinean peso in cash, and which will be monitored by the Central Bank and three companies from the financial sector, including Prisma, Red Link, Interbanking, and Coelsa.

Despite the interest of the BCRA in replacing cash in the country, the local cryptocurrency community has taken this stance with some skepticism. Camilo Jorajuría, an Argentinean legal consultant and expert in bitcoin and blockchain affairs, made the following comment through his Twitter account on the digital wallet promoted through Transferencias 3.0, raising concerns on privacy:

The desire of regulators, local and global, is the Chinese model. Maximum population control with zero privacy. Only bitcoin fixes this.

Crypto Adoption Keeps Surging in Argentina

A study published by Chainalysis on September 3, 2020, analyzed the current status of cryptocurrencies in Latin America, highlighting Argentina as one example of how its depreciation in the national fiat has been boosting crypto adoption significantly so far this year.

The report also adds that restrictions on the amount of U.S. dollars that Argentineans can buy per month fuel the need for buying cryptocurrencies across the nation, as such barriers limit their options to secure savings.

Do you think the recent tax measures will only help to further boost crypto adoption in Argentina? Let us know in the comments section below.

The post Bitcoin Is Going Through the Roof in Argentina While the Government Imposes New Taxes appeared first on Bitcoin News.

East Asia Dominates World’s Onchain Crypto Activity, Europe and North America Trail Behind

19/09/2020 by Idelto Editor

Crypto activity continues to flourish worldwide, according to a new cryptocurrency adoption index published by the blockchain intelligence firm Chainalysis. The researchers compile onchain digital currency retail value transferred, onchain crypto deposits, peer-to-peer exchange volume, and other types of methodology.

Chainalysis recently published a new report called the “2020 Geography of Crypto,” a study that examines 154 countries and the flourishing cryptocurrency adoption in these areas. The company created a crypto adoption index from the large list of nation-states and only 12 countries had very little traction compared to the rest.

Nation-states that ranked the lowest in the adoption index include Afghanistan, Algeria, Cape Verde, Chad, Fiji, Laos, Libya, and Mongolia.

The top ten countries are ranked by four individual metrics that are combined to create the official ranking. The top country, as far as onchain value received, onchain retail value received, number of onchain deposits, and peer-to-peer trade volume is the Ukraine.

This country is followed by Russia, Venezuela, China, Kenya, U.S., South Africa, Nigeria, Colombia, and Vietnam respectively. “Cryptocurrency is truly global,” the Chainalysis report notes. “Developing countries have high grassroots cryptocurrency activity,” the study adds.

Chainalysis continues by adding:

Venezuela is an excellent example of what drives cryptocurrency adoption in developing countries and how citizens use [crypto] to mitigate economic instability— Venezuelans use cryptocurrency more when the country’s native fiat currency loses value to inflation.

The study emphasizes that the wealth preservation tactic is leveraged in Africa and East Asia as well. Moreover, peer-to-peer cryptocurrency exchanges are essential to digital currency adoption in developing nations, Chainalysis highlights.

In the section that covers Africa, the blockchain intelligence firm says both remittances and currency devaluation is what’s driving crypto adoption throughout the large continent. The study notes that major cryptocurrency trading platforms now look at Africa as an “opportunity.”

Chainalysis details that in Africa regions like Kenya, Nigeria, and South Africa have been seeing more adoption than other areas throughout the continent. Central & Southern Asia and Oceania (CSAO) is also covered in the Chainalysis study and researchers say growth is “already strong.”

The CSAO area is seeing a number of cryptocurrency regulations adopted within a variety of countries. CSAO is the fifth-most active region worldwide when it comes to cryptocurrency activity and it’s seen over $41 billion sent and $40 billion received during the last 12 months.

East Asia is the world’s largest crypto market, in terms of crypto activity, capturing 31% of all the digital currency transactions in the last year. Crypto addresses stemming from East Asia accounted for $107 billion received.

East Asia’s cumulated data is 77% larger than the crypto activity in Northern and Western Europe. East Asia is dominated by “pro traders” and “stablecoins,” the Chainalysis report highlights. Stablecoin usage in East Asia is “off the charts” in comparison to other regions worldwide.

Eastern Europe has the fourth-largest crypto activity rating globally, and it also contains the top two countries represented in the Chainalysis’ crypto adoption index: Ukraine and Russia. “Eastern Europe shows a strong grassroots-level of cryptocurrency adoption,” Chainalysis notes.

One reason Russia and Ukraine take the cake, as far as cryptocurrency activity is concerned, is because adoption has come “amidst regulatory uncertainty.” For instance, Chainalysis says that Ukraine has zero crypto regulations, but the government just started monitoring crypto activity.

Latin America is smaller in terms of onchain activity, and cryptocurrency adoption is low in contrast to the aforementioned regions. Latin America saw $25 billion in crypto assets sent and $24 billion received in the one-year timeframe.

In any 30-day span, Latin America represents 5% to 9% of the crypto activity aggregate on any given month, Chainalysis emphasizes. Even though Chainalysis says the region is one of the “hottest markets,” it also holds the second-lowest growth rate from the regions the researchers studied.

The crypto forensics firm says the Middle East is a smaller digital currency ecosystem, and the region is the second-smallest worldwide. According to the “2020 Geography of Crypto” study, Turkey captures the most crypto activity in the Middle East. Out of the 154 countries Chainalysis studied, Turkey ranks 29th in the crypto adoption index.

Chainalysis mentions that Turkey is a strong crypto adopter due to the Turkish lira falling in value. The fiat currency crisis was sparked by President Recep Tayyip Erdoğan’s authoritarianism and Turkey’s mountains of private foreign-currency-denominated debt.

Toward the end of the report, Chainalysis touches on North America (the United States & Canada), which captures “conservative buy-and-hold” investors, and institutional investors as well. North America accounted for $52 billion sent and the same value received during the course of the 12-month span.

“North America is the third most active region by cryptocurrency volume moved onchain, just behind Nothern & Western Europe (NWE) and well behind East Asia,” Chainalysis says. Addresses stemming from North America accounted for 14% of all the crypto activity studied during the company’s research.

Chainalysis further notes:

North America also hosts a growing class of institutional investors conducting even larger transfers of cryptocurrency.

Additionally, Chainalysis highlights that a number of the global regions have formed crypto alliances. “North America and Nothern & Western Europe (NWE) form a quasi-common market, plus heavy trade with East Asia,” the “2020 Geography of Crypto” findings detail.

NWE has a “strong professional market” but also a “surprising” amount of illicit activity. As far as crypto activity is concerned, NWE is the second-largest territory behind East Asia. The NWE region accounts for 17% of all the crypto transactions worldwide.

NWE exhibits similar characteristics to North America in terms of institutional and professional traders. However, NWE’s crypto activity is also “largely driven by ransomware and darknet markets.”

The 130-page study shows that crypto adoption and activity has grown exponentially in certain regions. A number of other countries and the regional bureaucrats are just becoming aware of cryptocurrency technology, and are falling behind the eight-ball in comparison.

Today in 2020, East Asia is the crowned king of crypto activity worldwide with NWE following behind the region. The report concludes with an interactive crypto index table that shows all 154 countries’ Chainalysis studied during the year.

What do you think about East Asia’s crypto dominance and the “2020 Geography of Crypto” study? Let us know what you think in the comments section below.

The post East Asia Dominates World’s Onchain Crypto Activity, Europe and North America Trail Behind appeared first on Bitcoin News.

Argentina’s Peso Plunges After Central Bank Tightens Foreign Exchange Controls: Citizens Discuss Bitcoin Adoption

18/09/2020 by Idelto Editor

The Argentine peso plunged by more than 10% shortly after the country’s central bank announced measures to tighten controls on the movement of foreign currency. The peso, which is officially pegged at 72 for every USD, touched new lows of 145 to the greenback on the black market. The latest plunge is seen as a further boost to bitcoin and other cryptocurrencies in a country that has been plagued by currency challenges for over a century.

Still, in a statement released on its Spanish language website, the Board of the Central Bank of the Argentine Republic (BCRA) justifies the new measures saying they are an attempt “to promote a more efficient allocation of foreign currency.” Loosely translated, the statement goes on to say:

Federal Administration of Public Revenues (AFIP) has established a “mechanism for the collection of taxes on income and on personal assets at a rate 35% for external asset formation operations (FAE) by individuals as well as on purchases with cards (debit and credit) in foreign currency.

The objectives of the new measures are to “maintain the current quota of $200 per month whilst discouraging the hoarding foreign currency and card expenses.”

Crisis laden Argentina is in its third year of an economic recession partly blamed on the country’s unsustainable external debt levels. BCRA admits that the servicing of these obligations is having an undesired effect on the country’s exchange rate.

Consequently, the new measures also seek to “establish guidelines for a renegotiation of the private external debt compatible with the normal operation of the exchange market.”

However, as previously reported by news.Bitcoin.com, Argentina alongside Venezuela, are two Latin American countries that are seeing their fiat currencies lose value due to excessive printing of money which causes inflation.

Quoting a Chainalysis study, the same report notes that Argentina’s imposition of limits on the amount of U.S. dollars that citizens can buy per month further restricts available options of shielding savings from inflation. According to analysts from the region like Sebastian Villanueva of Chilean crypto exchange, Satoshitango, it is such limits that are helping to spur on the use of cryptocurrencies in the country.

The Chainalysis study already ranks Argentina as the country with the third-highest value of cryptocurrency received between July 2019 and June 2020, just under $3 billion.

Meanwhile, some Argentine citizens reacting to the announcement by BCRA concur with the notion that the latest policy changes will push more towards cryptocurrencies. One citizen who shares this perspective is journalist, Emiliano G. Arnáez. The journalist has previously tweeted how successive Argentinian governments have failed the economy and how bitcoin can be an alternative that his countrymen can use.

In his remarks, Arnáez touts how the main attributes of bitcoin make the digital currency a better alternative to the country’s fiat currency:

“Remember: if you have Bitcoin, they have their own Central Bank. With cryptocurrencies, there are no stocks, with stablecoins, there are no exchange restrictions. They (cryptocurrencies) have a high risk, of course, they do, but the Argentine economy sometimes seems to be riskier and is (repeatedly) hacked by the governments themselves.”

Another Twitter user, Ramiro Marra confirms the immediate impact BCRA’s announcement after tweeting that the “crypto dollar is already at 160. It is going to be a very difficult day.”

The comments by Argentine citizens reaffirm Villanueva’s earlier assertions that “people just want a safe way to store money, and there are no gatekeepers in crypto.”

What do you think about Argentina’s latest currency woes? Tell us your thoughts in the comments section below.

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Ukraine, Russia, South Africa, Nigeria Among Top Countries by Cryptocurrency Adoption

09/09/2020 by Idelto Editor

Ukraine, Russia, China, South Africa, Nigeria, Kenya, and the U.S. are among the top-ranking countries by cryptocurrency adoption, according to the 2020 Global Crypto Adoption Index compiled by blockchain data analytics firm Chainalysis.

Countries With Highest Crypto Adoption

Chainalysis’ 2020 Global Crypto Adoption Index, released Tuesday, ranks 154 countries based on their cryptocurrency adoption. “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,” the firm explained.

The crypto adoption index is made up of four metrics, calculated 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,” Chainalysis described. “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.” Noting that it will continue to tweak the methodology used, the firm claims:

This methodology represents one of the first ever attempts at a comprehensive country-level breakdown of global cryptocurrency activity.

According to Chainalysis, Ukraine ranks first, followed by Russia, Venezuela, China, Kenya, the U.S., South Africa, Nigeria, Colombia, and Vietnam.

Ukraine, Russia, South Africa, Nigeria, Among Countries With Highest Cryptocurrency Adoption — The top 10 countries by Chainalysis’ 2020 Global Crypto Adoption Index that ranks 154 nations based on crypto adoption.

Of the 154 countries analyzed, only 12 had “very little” crypto activities and are ranked the lowest, Chainalysis detailed, adding that the countries are Afghanistan, Algeria, Cape Verde, Chad, Fiji, Laos, Libya, Mongolia, Tajikistan, Turkmenistan, West Bank and Gaza, and Zimbabwe.

Following Chainalysis’ ranking publication, the Ukrainian Ministry of Digital Transformation commented: “The market of virtual assets in Ukraine is quite developed and has a significant turnover even on a global scale, but most of it is concentrated in the shadow zone, which creates potential risks for both the state, business and users.”

The ministry added that it “continues to create a legal framework for regulating the cryptocurrency market in Ukraine and hopes that in September the draft law on virtual assets will be considered by the parliament.”

What do you think about Chainalysis’ crypto adoption ranking? Let us know in the comments section below.

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