- According to a Chainalysis report, UK has been inspiring other countries of Europe in crypto adoption.
- Ideal opportunity for the UK to step up and stamp its authority to be one of the competitors of US.
The United Kingdom has been for a while seizing the cryptocurrency market share in Europe.
According to a Chainalysis report, the UK has been leading and inspiring other countries in Europe in the field of crypto adoption and a major competitor of the US.
The UK has become one of the hottest hubs in crypto adoption, with several retail stores adopting various forms of cryptocurrencies as a mode of payment. The UK's stronghold in the region is a testament that it is indeed a force to reckon with, especially following China's crackdown. China at one point of time, was one of the major competitors for the US in the cryptocurrency market.
According to the Chainalysis report, the UK has now been one of the growing hubs and has topped the crypto transactions worth US $170 billion (£123 billion).
Opportunity for UK to step up and be a force to reckon with
Today, people in the UK are finding it quite convenient to shop and trade in various cryptocurrencies, thus adopting the alternate mode of payment services. The data for Central, Northern, and Western Europe (CNWE) show that the transaction volume received a massive bump in almost all the cryptocurrencies, especially on the decentralised finance (DeFi) protocols. This enabled it to become the largest trading partner driven by the institutional players who grew from US $1.4 billion in July 2020 to US $46.3 billion in June 2021.
How UK is becoming a leading force in crypto adoption
UK's stronghold in the region is a major wakeup call for countries, mainly the US. The Chinese authorities had banned the crypto mining ban in May, sending shockwaves across the cryptocurrency industry, not just from the trading point of view but also for Bitcoin mining.
Following China’s ban, exchanges such as Huobi, Binance, Bitfinix etc., had to shut shop and move their operations outside China. This is an ideal opportunity for UK crypto industry to further stress its authority as a leading market, following US. With increased adoption, the opportunity is there within the UK market with leading exchanges such as Coinbase, Bitfinix, Crypto.com, all having their presence in the country.
Also read: The Best Cryptocurrencies of 2021
UK outperforms France, Germany
The UK has reached the heights ever since firms such as PayPal, Square, Revolut, expanded their services to the country to make crypto trading an easy process. Besides, they also offered rewards to the customers, which encouraged them to use the services more frequently.
One of the reasons that made UK stand out in the CNWE region was the ease by which the institutional investors completed transactions in Ethereum and wrapped Ethereum (wETH), which are commonly used in DeFi protocols.
Also read: The Effect of China’s Crypto Crackdown
While Bitcoin made up 27% of the UK’s transaction value, Ether and wETH was at 40%. The UK beat France, Germany, the Netherlands, and Switzerland, which made up the rest of the top five in the region.
The Chainalysis research included data from North America, Europe, Eastern Asia, Latin America, and the Middle East, focusing on geographic crypto adoption, usage, and regulation trends.
Bank of England still wary
Despite the cheer, the Bank of England wants to tread carefully going forward. Last week, Bank of England Deputy Governor Sir Jon Cunliffe said that he wants regulation of cryptocurrencies to ensure the financial stability of the market.
Cunliffe stated that the cryptocurrency market has grown manifold, with crypto assets growing from roughly US $800 billion to US $2.3 trillion today. He further added that the regulators, banks, and exchanges all need to be on the same page to ensure that the market doesn’t face a crisis like in 2008.
The UK’s lead in the crypto market should encourage the financial institutions and market participants to get involved more actively in the near future. Bitcoin’s bull run along with other altcoins performance should further provide the impetus to the market and investors the confidence to invest in cryptocurrencies to ensure that they can take the crypto adoption and elements to the next stage in the country.