Global Crypto Adoption Report 2023 : A Pivotal Year for Crypto Acceptance Worldwide

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Crypto as an asset has been gaining interest widely. It is definitely a topic of significant interest owing to the power of earning it gives to the individuals. This report by Coinpedia encloses the major questions related to the acceptance of crypto in 2023.

We will step-by-step unfold the adoption of crypto in 2023 worldwide by mentioning all about the leading nations which have embraced cryptocurrency and digital finance facets. We will also look at all the minute details of crypto adoption scenarios among individuals, covering the important lists like the new-comers, new countries and demographic representation of the crypto adoption in 2023.

This report holds all that one needs to know about the important events which affected crypto adoption among nations and what could 2024 have in store for all the crypto investors!

A Brief Overview

In a world on the verge of a complete financial revolution, the 2023 Global Crypto Adoption Report by Coinpedia gives us some in-depth information about how the East and the West are adapting themselves to the digital financial evolution. In this report, we will understand all about the challenges which the nations have to overcome in order to be on the crypto track. We will also shed some light on the overall market situation, adoption metrics, global patterns, and the upcoming challenges in 2024.

If we talk about the Global Crypto Adoption Report, its goal is to combine the on-chain data and real-world information. This is done to deduct the countries leading the world in grassroots crypto adoption. It is not about the countries’ transaction volumes ( we could already guess that the wealthier countries are ahead in this case) but it highlights the countries where average, everyday people are accepting crypto the most. The Global Crypto Adoption Index is there to identify countries where people are putting a major part of their wealth in the cryptocurrency lane. In this report, we will highlight the top 20 nations with the highest level of crypto adoption in 2023. 

Crypto Market Overview

By keeping the overall crypto landscape in mind, here are a few deductions made by the experts.

• Global market cap is $1.55 trillion, currently in 2023. Recent development in AI is expected to affect the growth and adoption of crypto worldwide.
• Revenue is expected to show an annual growth rate (CAGR 2023-2027) of 14.40% leading to a projected total amount of US$64.9bn by 2027.
• The average revenue per user in the Cryptocurrency market amounts to US$56.2 in 2023.
• From a global comparison perspective, it is shown that the highest revenue is reached in the United States (US$17,960.00m in 2023).
• In the Cryptocurrencies market, the number of users is expected to reach 994.30 million users by the end of 2027.
• User penetration was 8.77% in 2023 and is expected to hit 12.51% by 2027. There are around 420 million crypto users worldwide in 2023.

Let us have a look at the global ownership of Bitcoin in 2023:

Figure	Findings
Bitcoin Owners	106 million
Daily BTC Users	400,000
Bitcoin Wallets	200m
Bitcoin Traders	53m
Daily BTC Transactions	270,000

The chart represents ownership of Bitcoins in 2023 region-wise (in millions)

A Major development in the Market

The Year 2023 has witnessed unprecedented growth , technological innovation, more regulatory clarity, and an increment in the acceptance of cryptocurrency worldwide. Majorly, we have seen the crypto adoption by retail and institutional players in 2023. 

Mass adoption

There has been a significant surge in mainstream acceptance of digital currencies. Despite so many regulations by the US SEC, cryptocurrency has seen a huge rate of acceptance among countries worldwide. Major financial giants embraced crypto, thus laying the foundation for 2024 to see a boom in mass adoption. With regulatory clarity among various jurisdictions worldwide, more traditional investors are expected to enter the market in 2024.

CBDCs (Central Bank Digital Currencies)

CBDCs have been on the radar of the banks worldwide. 2024 could be the year when several countries are foreseen to develop and implement their CBDCs. 2023 has marked a paradigm shift in the way governments look at cryptocurrencies. Let us have a look at the 2023 updates in CBDCs among different nations:

• As of November 2023, 130 countries are exploring a CBDC, representing 98 percent of global GDP.
• Asia and Africa are the current hotbeds of crypto adoption! The Bank of Korea announced its first step to adopt CBDCs in October,2023.
• In 2023, 64 countries got into the advanced phase of exploring CBDCs. 
• The European Central Bank took a significant step toward CBDC exploration, announcing the preparation phase for a digital Euro in October,2023.
• In October 2023, MasterCard concluded a CBDC blockchain pilot with the Reserve Bank of Australia.
• The Central Bank of Brazil is currently addressing privacy issues as it has already developed digital real (DREX). 
• PetroChina, a Chinese oil and gas company, has already completed the first international crude oil trade using e-CNY. 
• Reserve Bank of India plans to launch its CBDC in the interbank borrowing market, using the tokens for call money settlement. It is undergoing a pilot phase.
• Bank of Japan launched a forum in partnership with 60 companies for a pilot program on digital Yen.
• Nepal Rastra Bank also announced the plans to develop CBDCs.
• Russia aims for mass adoption of its digital Ruble by 2027.

Global Patchwork of Regulations

In 2023, we saw different countries approaching crypto regulations in diverse ways, reflecting the unique economic, social and political landscapes of each region. Some of them have accepted crypto as a legitimate form of finance, while others remain sceptical.

So what’s really driving the adoption of crypto in 2023?

In recent surveys, respondents actively said that they wanted more control over their online identities and data. But is it driving folks to Web3? The evidence points to speculation! As consumers are gaining all the information about the crypto world, their interest is peaking. There have been many driving forces paving the way for crypto adoption in 2023.

Crypto Adoption Scenario: 2023

As the year 2023 comes to an end,we have reported all the major events which marked the adoption of crypto in 2023. This report by Coinpedia aims to highlight all the yearly developments which aided in the acceptance of cryptocurrency worldwide. We have also studied the factors which have helped in this entire process. With Bitcoin crossing the USD $40,000 mark, we are hopeful of massive 2024 profits. Do you know about the halving scenario in 2024? Do you think 2024 will be the bull season for crypto enthusiasts? 

We will analyse the 2023 trends and share the crypto insights for 2024 in our yearly report on Crypto Global Adoption by Coinpedia.

Countries To Look At In 2023 

New Crypto-friendly policies in 2023

We all know that El Salvador became the first country to adopt Bitcoin as legal tender, mandating that businesses accept crypto as a form of payment. Recently, the country has shown more crypto-friendliness by announcing a joint initiative with Tether called “Adopting El Salvador Freedom” that allows foreigners to obtain a Salvadoran passport in exchange for paying $1 million in Bitcoin. While some nations have put strict bans on crypto usage, others have embraced this monetary evolution dearly. 

Country with the largest crypto ownership in 2023

UAE becomes the country with the largest crypto ownership in 2023. With almost 28% of its population owning crypto as an asset, UAE tops the list here. It is followed by Vietnam with 18.73% and Saudi Arabia with 17.53% of the population owning cryptocurrency.

Crypto-friendly countries in 2023

Let us have a look at the countries which are favourable for cryptocurrencies in 2023.Here is a list of the countries which are crypto-friendly in 2023:

Country	Current Scenario(Dec 2023)	Regulatory Conditions in 2023	Crypto Taxation Policy in 2023
Switzerland	Hosts crypto firms like Ethereum Foundation	Favourable	Low/ No tax on crypto profits
Malta	Known as Blockchain Island	Ruled by laws like Virtual Financial Assets Act, Innovative Technology Arrangements and Services Act, Malta Digital Innovation Authority Act	No capital gains tax on crypto transactions
Estonia	Applying its digital-first approach to crypto sector by providing licensing system for crypto exchanges and wallet service providers	Favourable	No capital gains tax on the sale of digital assets
Singapore	Hotspot for crypto businesses and investors	Payment Services Act to regulate crypto service providers, under the supervision of the Monetary Authority of Singapore. The act marks distinctions among payment tokens, utility tokens and security tokens.	No tax on crypto profits unless they are derived from trading activities
Japan	Most advanced crypto market of the world. Bitcoin has been the legal form of payment since 2017.	The Financial Services Agency laid clear crypto regulations. Japan Virtual Currency Exchange Association sets standards for the crypto industry.	Income tax is levied on crypto profits for individuals , from 15% to 55% , depending on the amount
Canada	Well-developed crypto systems exist here with local exchanges, and start-ups	Regulates crypto businesses under the Proceeds of Crime and Terrorist Financing Act	Taxes crypto profits as either income or capital gains
South Korea	Most active crypto country for trading and adoption	Regulated crypto under the Act on Reporting and Use of Specific Financial Transaction Information	Taxes crypto profits as income at a flat rate of 20%
Portugal	Very welcoming when it comes to crypto	Favourable	No tax on crypto profits
Germany	Bitcoin has been a legal form of payment since 2013 here.	Regulates crypto under Banking Act	Offers tax exemption for crypto transactions held for more than a year
Netherlands	It has many crypto exchanges, start-ups, and organizations, such as Bitonic and the Bitcoin Foundation	Self-regulatory model for crypto service providers by requiring them to register with the Dutch Central Bank	Does not tax crypto profits for individuals

Crypto adoption rate in 2023

Let us see the difference in the rate of crypto adoption among countries from last year till now. Crypto adoption rate differences have been recorded from 10 countries all across the world in this table:

Country	2022	2023
Nigeria	45%	47%
Turkey	40%	47%
UAE	34%	31%
Brazil	22%	28%
India	22%	27%
Argentina	35%	26%
Malaysia	20%	23%
Saudi Arabia	20%	23%
Switzerland	18%	21%
South Korea	19%	20%

Deductions from this report by Statista confirm that the consumers from countries in Africa, Asia and South America were most likely to be an owner of cryptocurrencies, such as Bitcoin, in 2023. 

2023 International Summits and Crypto

G20 and The Crypto Asset Reporting Framework

• The biggest announcement in favour of Cryptocurrency was made in September’s G20 summit held in India. The G-20 leaders decided on swift implementation of the reporting framework for crypto assets. They quoted a need for the significant number of member nations wanting information exchange on such non-financial assets by 2027.
• The Crypto Asset Reporting Framework (CARF) is the major outcome of the summit. It is going to be developed to make sure that the crypto assets are not used by tax evaders to conceal their unaccounted wealth.
• As the world’s largest economies gathered in India for the G20 Summit in September 2023, the global crypto community was abuzz with hopes . 
• This event had a profound impact on how future regulations and advancements on crypto will be outlined, both in India and across the globe. Thus, giving optimism to the crypto enthusiasts.
• In October 2023, The G20 Finance Ministers and Central Bank Governors (FMCBG) under India’s presidency released a joint communique in October in Marrakech, Morocco, adopting the roadmap proposed in the Synthesis Paper as a G20 Roadmap on Crypto Assets.

The International Summit showcased the growing rate of adoption of crypto in developing and recently developed nations as well.

Crypto Demographics 2023

There have been 420 million crypto owners worldwide in 2023. Here is a simple breakdown:

Brands Accepting Crypto in 2023

• In October 2023, Ferrari started to accept payment in cryptocurrency for its luxury sports cars in the U.S. and might extend the scheme to Europe following requests from its wealthy customers.
• Ralph Lauren Miami store has started accepting crypto as payment in April,2023.

Institutional Adoption Of Crypto in 2023

The crypto landscape is going through a seismic shift and the adoption is increasing by institutional investors. No longer restricted to the finance fringes, crypto is making its way into the portfolios of some of the world’s largest banks and investment places. Here are some of the findings about the institutional adoption of crypto in 2023:

• 83% of institutional investors believe that crypto will become a major part of the mainstream financial system within the next five years.
• BlackRock, Goldman Sachs, and Morgan Stanley are a few examples of institutional players that have already taken a crypto plunge.
• In Q3 alone, Microstrategy added over 6600 Bitcoin to its portfolio and now has 158,400 BTC.
• The approval of a US Spot Bitcoin ETF will attract more institutions into the space. 
• In September 2023, Visa Inc. revealed that it is expanding its stablecoin capabilities. The company would now introduce the USDC stablecoin on the Solana blockchain network. The company has been experimenting with the USDC stablecoin since 2021 and has now integrated the Solana network due to its efficient and speedy systems. 
• Block Inc. is a leading financial technology firm based in the United States. The company formerly began the development of Bitkey, a crypto product. The company is making leaps in the industry and reports strong earnings, which reflects that the crypto industry is far from declining. In August 2023, Block, Inc. reported results from the second quarter of 2023. The company’s revenue for the quarter jumped 25.67% year over year and amounted to $5.53 billion, ahead of market consensus by $433.36 million. Isn’t it a positive sign for crypto ascent in 2024?
• Fortune 100 companies have made 109 private venture capital investments across 80 crypto blockchain startups since 2017, participating in rounds totaling more than $8 billion. The average Fortune 500 company initiative or project budget for 2023 is nearly $5.8 million. That’s surely an optimistic way led by institutions adopting crypto in 2023.

• Global payment processing giant PayPal announced its United States dollar-pegged payment stablecoin called PayPal USD (PYUSD) in August 2023. The stablecoin is developed on Ethereum (ERC-20) and will be issued by Paxos Trust Co. PYUSD is reportedly fully backed by U.S. dollar deposits, short-term Treasurys and similar cash equivalents.PayPal said that the launch showcases the company’s focus on becoming a crypto payment giant and aims to make the stablecoin a key part of its payment infrastructure. 

Crypto 2023: Driving Forces Vs. Setbacks

• Following the bankruptcies of FTX, BlockFi, Voyager Digital, and other cryptocurrency platforms, the U.S. Securities and Exchange Commission (SEC) accelerated its push to subject these markets to the full potential of its financial regulations. In the first half of 2023 alone, the SEC took 24 cryptocurrency enforcement actions.
• FTX crypto scandal (2022-2023): FTX, once the leader among global cryptocurrency exchanges, became the face of crypto fraud when its founder and former CEO Sam Bankman-Fried was arrested on behalf of U.S. authorities on charges of fraud, money laundering, and violating campaign finance laws. FTX quickly went into bankruptcy.
• Voyager bankruptcy (2023): Voyager, a New Jersey-based crypto lender, declared bankruptcy in 2023 as part of the fallout from the liquidation of crypto hedge fund Three Arrows Capital, which defaulted on loans to Voyager totaling $654 million. This put a spotlight on the high-risk nature of crypto lending practices​.

Major Crypto Adoption Headlines of 2023

• In September 2023,Morocco came in the top 20 countries with highest Bitcoin usage.
• Half of the people in Turkey own crypto by September 2023.
• Crypto flourishes in Vietnam with 16.6 million holders.
• More than half the Fortune 100 are developing Blockchain initiatives to stay ahead of the game.
• India becomes the second largest crypto market despite the high taxes.
• China, Hong Kong and East Asia slowed down in crypto trading this year.

Grassroot  Crypto Adoption Report

Here is a list of the top 10 nations based on different adoption metrics. We have provided a description of each sub-index, how it is calculated and why we believe it is valuable for measuring the grassroots crypto adoption.

Country	Region	Overall index ranking
India	Central & Southern Asia and Oceania	1
Nigeria	Sub-Saharan Africa	2
Vietnam	Central & Southern Asia and Oceania	3
United States	North America	4
Ukraine	Eastern Europe	5
Philippines	Central & Southern Asia and Oceania	6
Indonesia	Central & Southern Asia and Oceania	7
Pakistan	Central & Southern Asia and Oceania	8
Brazil	Latin America	9
Thailand	Central & Southern Asia and Oceania	10

Source: Chainalysis.com

While India beats other countries which had high rates of crypto trading as well as mining, it also came in second when looking at the top countries by raw estimated crypto value received between July 2022 and June 2023. India reported around $250 billion in crypto value in the past year, behind only the U.S. and roughly $1 trillion it recorded in crypto value received during the same time.

India currently taxes crypto gains at 30% and also subtracts 1% from the source. After TDS implementation by exchanges, many international exchanges are not doing it effectively for the users here.

Thus, allowing a rise in web traffic from India to foreign crypto exchanges. Home-grown crypto exchanges , like WazirX, saw their funds frozen and were investigated by the Enforcement Directorate (ED) last year. Indian crypto traders invest in top-value assets like Bitcoin and Ether. They also work with meme-based assets like Dogecoin and Shiba Inu.

Global Crypto Trends in 2023

Here is a rundown of highlights in 2023:

Crypto Adoption rates dropped in Q1 and Q2 2023:

After 2022’s setbacks, grassroots crypto adoption dipped in Q1 and Q2. However, after U.S Bitcoin Spot ETF Speculations, the adoption rate increased comparatively.

North America’s dominance

The global crypto transaction volumes are still led by North America, backed by the U.S. 24.4% of the total transaction volume lies in the hands of North America.

Emerging Nations Leading Adoption

Lower middle income (LMI) countries like India, Vietnam, and Nigeria outshine more developed counterparts in the crypto adoption realm.

North America’s Stablecoin Demand dips, Latin America goes upwards

Due to regulatory concerns, the demand for stablecoins dipped in North America. In contrast, Latin America faced high inflation, and showed rising demand for stablecoins.

DeFi adoption slowed down

Since the market peak in November 2021, the total value locked (TVL) has dropped from $180 billion to $47 billion today. However, DeFi adoption is not stagnant. In Central, Northern, and Western Europe, DeFi accounted for 54.8% of the total value of crypto assets gained. Central and Southern Asia, Oceania, and Eastern Europe also joined the line of the nations which witnessed regional year-over-year (Y0Y) growth of value sent to DeFi.

Main drivers for Crypto Adoption in 2023:

Hedging	It shows the countries leading in crypto adoption are facing inflation or currency devaluation. Nigeria, Turkey and Argentina being in the top 20 list shows the same!
Remittances	The global remittance market was valued at $830 billion in 2022. Sending money back home can cost as much as 6.3% in countries like Mexico. Latin American countries are aggressively adopting crypto for remittances.
Gambling, Gaming, and Speculation	While the NFT bear market may have slowed down activity, it is still a major influence on adoption.
Store of value or portfolio diversification	BTC is up over 120% this year, making it one of the best-performing assets.

Challenges in Crypto Adoption

2023 has faced a lot of challenges in terms of crypto adoption. We have compiled the top crypto adoption challenges in 2023 here:

• Lack of awareness about cryptocurrency and how it works! 
• Due to extreme volatility, users hesitate to put their money in crypto.
• The Lack of regulatory framework and the unregulated status of crypto make some areas sceptical about crypto adoption thoughts.
• Taxation and its uncertainty in different regions of the world make it difficult for individuals to understand the concept.
• Hacking and theft cases have demotivated a lot of investors.
• The irreversibility of transactions makes people cautious of the usage of digital money.
• Lack of trust in digital space has led to people thinking a hundred times before investing in the crypto pool.

Outlook for Crypto Adoption 2024

Will cryptocurrency soar or fall in 2024? Will Bitcoin continue its volatility? Will the market be more regulated? Will crypto adoption increase in 2024? All this comes up when we look at the current crypto scenario in 2023. Our experts predict these five things for the cryptocurrency arena in 2024:

• Bitcoin might hit USD $100,000 by the end of 2024 but it is unsure to say anything precisely.
• According to The Ascent, more than 500 million people worldwide will own Bitcoin by 2024’s end.
• The first Spot Bitcoin ETF could get the final approval,giving the investors direct exposure to cryptocurrency.
• There might be a movement towards decentralized finance (DeFi). DAOs could show some remarkable growth in 2024. 
• 2024 might see some key regulatory changes in the crypto market and there could be some stern deductions in the ongoing cases. 

We would like to put some extra focus on Bitcoin Halving in 2024! It is a historical fact that when the availability of newly minted bitcoins goes down, the price goes up. Start dreaming of all the gains you can enjoy if you do not miss the next halving wave. Game on? We advise you to learn before investing in crypto and be 2024 ready for the major events.

Final Thoughts

This is how the crypto market has seen evolution in the last few years. With 2023 being one of the major years in its progress, we have a lot in store for 2024 too. According to the experts, Regulatory conditions and worldwide crypto adoption are going to improve as we move through this decade.