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The increased regulatory clarity in many Asian markets has played a crucial role in increasing adoption for Bitcoin

While cryptocurrencies are seen with a lot of doubt and fear during its early years, the market has matured significantly over the past few years as many investors have flocked to crypto for a variety of reasons. Increased regulatory clarity, especially in many Asian markets, has played a key role in increasing the adoption of cryptocurrencies like Bitcoin. Today, countries like China are also leading the race when developing their own CBDC.

Bitcoin Asian markets continue to be a dominant force

In a recent episode of the Flippening podcast, Joyce Yang, founder & CEO of Global Coin Research, highlighted Asia’s growing role in the cryptocurrency ecosystem and how a wide variety of crypto-firms have made various parts of Asia the hub for their operations.

Yang pointed out:

“A physical hub can help support the burgeoning ecosystem of entrepreneurs, with funding and essentially bootstrap and accelerate the development of an ecosystem. This is similar to decades where venture capital and entrepreneurs all gathered together in the Bay area to create the Silicon Valley.”

the-increased-regulatory-clarity-in-many-asian-markets-has-played-a-crucial-role-in-increasing-adoption-for-bitcoin1

Joyce Yang, founder & CEO of Global Coin Research

In addition to the development and adoption of cryptocurrencies in various parts of Asia, Yang also emphasized decentralized innovations such as DeFi, which has gained much recognition and interest from the Asian market.

She stated:

“So for example, MakerDAO has 30% of website traffic volume coming from China. And in fact, the team actually has said that China is the second-largest market. I mean, while Compound has over 27% website traffic coming from China and Taiwan and dYdX has 25% volume coming from China.”

One of the reasons why the Asian market is quite receptive to cryptocurrencies and blockchain-based innovations have to do with the fact that most countries in the region have taken pro-active steps to encourage crypto via regulations. Yang stressed that Singapore’s governance model is a good example.

She said:

“The Monetary Authority of Singapore is an example of the kind of folks who are very savvy and in tune with a global kind of financial innovations. And one important regulation that just came into effect is called the Payment Services Act.”

The Payment Service Act was passed earlier in the year and according to the Monetary Authority of Singapore’s press statement, it is intended to enhance the regulatory framework for payment services in Singapore, strengthen consumer protection and promote confidence in the use of e-payments.

the-increased-regulatory-clarity-in-many-asian-markets-has-played-a-crucial-role-in-increasing-adoption-for-bitcoin

Source: Coin.dance

Asia’s presence is linked to the world’s largest cryptocurrency, i.e., Bitcoin cannot be ignored. Considering Bitcoin’s hashrate, most of the mining groups that provide it are based on China, especially Sichuan province. Highlighting how different countries and regions around the world have different views regarding the cryptocurrency infrastructure.

Yang noted:

“There will be a divergence in the development of what cryptocurrency and blockchain mean to each country.  I think with Libra getting the mandate from the US govt. to include the USD and Euro in their basket, it will become more of a geopolitical war.”

Has the cryptocurrency derivatives market found its home in Asia?

Yang highlighted how Asia has risen to prominence with large derivative exchanges operating out of the continent and how in the past few years there has been an explosive growth of derivatives trading. Highlighting the role of India and countries like Singapore to name a few within Asia.

Yang said:

“The trading market, as well as the lending market being kind of driving forces in Asia and, is kind of pushing the industry along. And that together over time has convinced me that Asia has one of the most robust hubs for crypto and Blockchain.”

In terms of the market, Yang also suggested the importance of robust regulation and how certain regulations in the US and Europe are now driving more entities east-ward.

She pointed out that:

“Spotlight in trading this year has been derivatives and leverage trading, honestly, and that’s happened a lot and mostly in Asia. If you look at regulations, it’s been stifling the development of retail derivatives and futures platforms in the US… the new rule around crypto regulations is pushing European trading firms towards Asia.”

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