The region of central, northern and western Europe, or CNWE, has emerged as the world’s most active cryptocurrency block, receiving over $1 trillion worth of digital assets over the past year, according to new research from blockchain analytics firm Chainalysis.
The report, which was released Tuesday, found that the CNWE region accounted for 25% of global crypto activity between July 2020 and June 2021. The region witnessed a sharp uptick in transaction volume across all crypto sub-categories, especially decentralized finance, or DeFi.
Chainalysis describes crypto transactions as anything involving trade, investments and business dealings.
Europe has also become a hotbed for institutional investing, with transactions values in this category growing to $46.3 billion in June 2021 compared with just $1.4 billion in July 2020. Perhaps surprisingly, the United Kingdom is the single largest crypto economy in the region at $170 billion worth of transactions. Nearly half, or 49%, of the value was sent via DeFi protocols.
“The U.K.’s growth is driven mostly by growing institutional investment, based on the large-sized transfers driving most of its transaction volume,” Chainalysis’ senior content marketing manager Henry Updegrave told Cointelegraph.
A secular bull market for Bitcoin (BTC), the growth of competing smart contract platforms and the arrival of decentralized finance all contributed to crypto’s massive rally during the study period. It comes as no surprise that CNWE’s crypto market activity peaked in May 2021 during the height of the bull market, which was one month removed from Bitcoin hitting $64,000.
Chainalysis’ data corroborate a growing body of evidence showing that large institutional investors have become a driving force within crypto. Wealth managers, family offices and other institutional players have poured billions of dollars into Bitcoin (BTC) and Ether (ETH) investment products offered by Grayscale, CoinShares, 21Shares and others.
Beyond the advanced economies of Europe, Chainalysis research has documented the growing uptake of crypto in emerging markets. The Chainalylsis 2021 Global Crypto Adoption Index named Vietnam, India and Pakistan as the leading countries for adoption based on on-chain value received, retail transactions and peer-to-peer exchange trade volume.