Blockchain’s Benefits are Attracting Countries Across the Globe
Blockchain has observed a meteoric rise in use over the last ten years, much of which can be attributed to the last two years during the Coronavirus pandemic. By now, many countries have already taken a stance on how blockchain — particularly cryptocurrencies — will impact their economy and society. Much of the focus has been geared predominantly towards countries with large economies such as the United States, China, Japan, the United Kingdom and the European Union. However, as blockchain adoption continues to grow, it will be necessary to analyze how other countries across the world are utilizing the technology and how, ultimately, an ecosystem of blockchain use across nations will form from this adaptation of our systems to the new technology paradigm.
With the U.S.A announcing on March 9th that it would create a task force to investigate blockchain and cryptocurrency as well as ensure it remained as the world leader in the field, it’s clear that the tech’s adoption and use will only increase from here. Knowing who, where, and how much support for blockchains exists across the world is necessary for making strategic decisions when it comes to investing or creating dApps.
Countries At the Forefront of Blockchain Development
- Bahamas
- China
- Japan
- Philippines
- South Korea
- United Kingdom
- Singapore
- United States
- Australia
This data is based on the report Blockchain for Government: Use Cases and Analysis by Clavin et al (2020) who utilized a number of metrics to analyze countries with the most blockchain activity.
Each of the above countries are rapidly developing blockchain technology and have the largest amount of funding to do so. Many of these countries have launched many of their own blockchain networks and many of their governments are supportive of further blockchain endeavors.
To date China (DigitalYuan), Nigeria (eNaira) and the Bahama’s (Sand) each already have Central Bank Digital Currencies (CBDC). However, none of these jurisdictions have adopted decentralized cryptocurrencies as Legal tender, with China and Nigeria going as far as to ban citizens from using them.
Although China recently banned Bitcoin mining and purchases/payments using decentralized cryptocurrency, overall blockchain research is still ongoing there and the country has rolled out a CBDC as well as a Blockchain Service Network (BSN) providing public blockchains for local and international users. This BSN permits 24 blockchains including Tezos, NEO, Nervos, EOS, IRISnet and Ethereum, thus authorizing them to provide services to Chinese consumers, and as such China is a global leader in the adoption of blockchain internally.
El Salvador
Currently El Salvador is the only country in the world whose government supports Bitcoin (or any form of decentralized cryptocurrency) as legal tender.
Ukraine
Recently Ukraine passed a bill to also accept Bitcoin and other cryptocurrencies as legal tender but it has not been fully integrated into law as of yet. With over $100 million in crypto donations for their war in defending against Russia, the move comes at the most opportunistic timing for them.
While speculation promotes Paraguay and Venezuela as the next countries that will support cryptocurrencies as legal tender, there have been little official and validated sources that prove this.
Countries that Are Discussing Blockchain the Most
In this section, an analysis of which countries are discussing blockchain the most using twitter data was conducted. A number of data sources were used to collect this information which include mentions of blockchain, surveys which constitute awareness and daily use of blockchain related technologies, and personal feelings towards blockchain.
For countries that use blockchain the most, the following consistently appear across all metrics which include peer 2 peer use, daily transaction volume, and infrastructure availability:
- Vietnam
- Nigeria
- India
- Philippines
- China
- United States
The following countries were considered the most likely to support blockchain development initiatives and technology research:
- United States
- China
- United Kingdom
- Australia
- Ukraine
While almost every country has access to blockchain technology and infrastructure the extent to which countries can use that technology varies nation to nation. For example, Singapore has relatively few restrictions on blockchain and cryptocurrency use for almost any purposes. While the United States has restrictions on how cryptocurrency can be purchased, exchanged, and utilized. So while some countries may support the development of blockchain more than others, there may be restrictions preventing full access to blockchain utilization.
The above information is indicative of a growing use case of blockchain across the world. While only El Salvador has made bitcoin (just one of thousands of cryptocurrencies) legal tender it’s clear that blockchain in and of itself is growing in use and interest in various governments. Many countries such as Venezuela have been experimenting with cryptocurrency as an alternative form of payment to reduce financial turbulence on its own government supported currency.
In the Middle East, the United Arab Emirates and Lebanon are leading the region in blockchain and cryptocurrency developments. The UAE has created ‘sandboxes’ for testing and innovation in the blockchain space free of regulatory considerations. The European Union, which has limited support for cryptocurrency focused payments, is exploring the advantages of blockchain for supply chain and several other sectors of its economy.
Singapore has a permissive and innovative regulatory regime which makes it an attractive country for projects to establish. Meanwhile Australia has announced an ambitious Roadmap to blockchain adoption in hopes of becoming a global hub in the field and driving innovation.
The advantages of blockchain technology for nation states is huge. From superior tracking of resource movement, to better management of assets, to improved security for networks, there are no shortage of use casesto which blockchain can be adapted and utilized. This interest will likely only grow in the future which will see a large amount of cash inflow into blockchain related markets.
Blockchain is a multi-use and multi-purpose technology that is growing in interest across the world. While some countries are allowing the unregulated use of cryptocurrency in day to day society, others are focusing on developing the technology and ensuring a firm understanding of its uses before implementing it on a larger scale.
While there is no clear indication for where blockchain support will land in the next five years, one thing is abundantly clear: the world has already begun adoption of blockchain and will continue to find new uses for it in the future.