A recent study published by analytics firm Chainalysis tells us which countries will make the most money in cryptocurrencies in 2021. Who are the best investors, and who are the worst performers?
Countries with the most cryptocurrency gains
Chainalysis says the methodology used is not without flaws, but it is a good way to get a global view of cryptocurrency gains by country. The first thing to note is that 2021 was mostly a positive year for investors: globally, they earned $162.7 billion. This is a net increase compared to 2020, when they earned “only” $32.5 billion.
If we look at the breakdown by country, we can see that investors from the United States earned the most:
Figure 1: Distribution of earnings by country
They are joined in the top three by the UK and Germany. France comes in eighth, with estimated earnings of over $4 billion.
Some heterogeneity
Chainalysis points out that while there are some major economies at the top of the rankings, there are also others that are vying for an enviable position:
“All of them are in the top three.
“Just like last year, we’re seeing a lot of countries whose collective cryptocurrency investment performance seems to outperform traditional measures of economic prosperity. “
Translation: countries like Turkey, Vietnam and even the Czech Republic have comparatively small GDPs, but their cryptocurrency gains put them at the top of the rankings. For example, investors in Turkey have made more money in 2021 than the French.
A big change comes from China, fourth in the ranking. The country created an earthquake in 2021 by banning cryptocurrency mining on its territory. And we’re seeing the effects on investment, according to Chainalysis. Investors’ gains in cryptocurrencies have indeed increased by “only” 194% since 2020, compared to 476% for the US, 431% for the UK and 423% for Germany.
Which cryptocurrencies have offered the most gains for investors?
Another change this year: gains in Ether (ETH) surpassed those in Bitcoin (BTC) for the first time. Investors earned $76.3 billion in Ethereum, compared to $74.7 billion in neighbouring Bitcoin. The reason is decentralised finance, according to Chainalysis:
“We believe this reflects the growing demand for Ethereum, thanks to the breakthrough of DeFi in 2021, with most DeFi protocols built on the Ethereum blockchain. “
Figure 2: Breakdown of earnings by cryptocurrency
However, there are some exceptions… One of them is Japan. The country shows a clear preference for BTC, which has generated nearly $4 billion for its investors, compared to $790 million for ETH.
The report concludes by explaining that this data shows signs of continued solidification of the sector:
“The data not only shows that crypto asset prices are growing, but also indicates that cryptocurrency remains a source of economic opportunity for users in emerging markets.”
