US Still Dominates Crypto Market, But Activities Decrease

JAKARTA - The US is the largest crypto market in the world, with transaction activities reaching 1.2 trillion US dollars or Rp19 quadrillion in a year. However, regulatory pressures have reduced crypto activity in the US.

Chainalysis, a blockchain analysis firm, released its latest report on October 23. The report states that the US accounts for 24.4% of global crypto transaction activity.

The report also shows that crypto activity in the US is dominated by institutions, which share between centralized exchanges and DeFi (Decentralized Finance).

However, the report also reveals that crypto activity in the US is experiencing a decline. This is due to the 'war on crypto' carried out by financial regulators.

"On-chain data shows that crypto activity in North America has declined in the past year, following negative developments such as the failure of FTX."

This activity fell further this year after the collapse of several major banks in the United States in March.

In addition, stablecoin activity has also started switching from America. "We have also observed a relative decline in the use of stablecoins in North America, compared to other digital assets, starting around February 2023," the report said.

Trust in stablecoins like the USDC of Circle is shaken after the collapse of Silicon Valley Bank, where the company has a big deal of exposure.

Most of the stablecoin's inflows to the top 50 crypto services have shifted from US-licensed services to unlicensed services outside the US.

"In the event that the US previously helped legitimize and start a stablecoin market, more crypto users are now pursuing stablecoin-related activities with trading platforms and overseas-based publishing companies."

In addition, this shift reduces regulatory oversight of dollar-related stablecoins in the US.

Congress is still slow in regulating and legitimizing stablecoins despite a number of proposed laws proposed by pro-crypto politicians. Overall, crypto regulation and stablecoins will play an important role in reversing the downward trend in North America.