India has emerged as the leader in the 2023 Global Crypto Adoption Index, according to data released by Chainalysis. The annual index aims to measure grassroots adoption of cryptocurrency by evaluating various metrics among more than 150 countries.
The index offers a nuanced look into how everyday people, rather than just large financial institutions or investors, are engaging with the digital currency landscape.
Top countries by adoption
India's leading position is followed by Nigeria and Vietnam, indicating a trend of rising crypto adoption in Central and Southern Asia and Sub-Saharan Africa. The U.S. ranks fourth, while Ukraine rounds out the top five.
The index uses a complex methodology that factors in on-chain value, retail activity, peer-to-peer exchange volume, and decentralized finance (DeFi) transactions, all weighted by purchasing power parity (PPP) per capita and other characteristics like the number of internet users.
Notably, the data shows that people in less wealthy countries are more likely to invest a bigger part of their money in cryptocurrencies.
Decline in global adoption
India and several other nations show promising growth in grassroots crypto adoption, but the global trend appears less optimistic.
Overall, the level of adoption has dipped since the late 2022 period, a time marked by the implosion of the FTX crypto exchange.
However, the data reveals that lower-middle-income countries (as classified by the World Bank based on gross national income per capita) have seen a stronger recovery in crypto adoption compared to other wealth categories. This suggests that in regions where traditional financial infrastructure is less robust or accessible, digital currencies may be filling an important gap.