Gemini’s 2022 Global State of Crypto report says that by 2018, cryptocurrencies had gone from being what many people thought of as a “fringe investment” to being an “established asset class.”
More than half of crypto owners in Brazil (51%), Hong Kong (51%), and India (54%), according to the survey, made their first cryptocurrency purchase in 2021.
The study, which polled 30,000 adults across 20 nations and six continents, also provided compelling evidence that rising inflation and currency depreciation are major motivators for the use of cryptocurrencies, particularly in developing and emerging economies.
More than five times as many people indicate they expect to purchase crypto in the future year as those in nations that have seen less than 50% currency devaluation versus the USD over the last 10 years.
Even though the Brazilian real’s loss of 218% of its value against the US dollar between 2011 and 2021 shows that inflation is very high, 45% of Brazilians polled by Gemini said they planned to buy cryptocurrency in the next year.
The rand in South Africa has lost 103% of its value over the previous decade, second only to Brazil’s loss of value among the 20 countries surveyed, and 32% of South Africans predict they will hold cryptocurrencies within the next year. Mexico and India, which had the third and fourth highest rates of devaluation or inflation, both followed the same pattern.
Over the same time period, the value of the Hong Kong dollar and the British pound remained constant relative to the U.S. dollar. In these countries, only 5% and 8% of people who answered the survey said they were interested in buying cryptocurrency.
What does this tell us, if anything? Gemini’s COO, Noah Perlman, notes that people’s crypto use cases vary widely based on their location.
However, as Stein Smith points out, this is still just one of many factors, and in some cases, there are even unique factors driving acceptance in different regions. Investors and business owners are “increasingly understanding the benefits of crypto assets” because they are “instantaneously accessible,” traceable, and cheap compared to other transaction options. There are other instances where crypto is being adopted because of the “potential capital gains and returns of crypto assets.”
Some 39% and 37% of respondents, respectively, in the Asia Pacific and Latin America areas, said that “legal uncertainties regarding cryptocurrency,” tax problems, and a general education deficiency could impede adoption, the report noted. Over half of the people polled in Africa said they would learn more about cryptocurrency if they knew more about it.
The Future of Money?
According to the survey results, Brazil and Indonesia have the highest per capita levels of bitcoin ownership. In each of these nations, 41% of respondents identified themselves as crypto holders. Only 20% of American respondents stated they had any cryptocurrency at all.
Inflation-stricken regions are more likely to see cryptocurrencies as the future of money.
As much as 66% of the population in Brazil, 63% in Nigeria, 61% in Indonesia, and 57% in South Africa share this attitude. One out of every five Danes, one out of every six Norwegians, and one out of every four Australians said they were religious.
Many countries continue to worry about inflation and currency devaluation. Bitcoin and other cryptocurrencies are being looked at as possible replacements for currencies in these kinds of places. Regulatory clarity and education could help change this in the industrialized world, where it is not the norm.