Who loves DeFi the most? Global adoption ranking of DeFi: the United States ranks first, with Vietnam and Thailand breaking into the top three.

The cryptocurrency research firm Chainalysis has released a global DeFi adoption index, which shows that unlike traditional cryptocurrencies that are most popular in emerging markets, DeFi is primarily adopted in high-income countries. The top five countries in DeFi adoption are the United States, Vietnam, Thailand, China, and the United Kingdom.

Composition of DeFi Adoption Index

1. Valuation of Tokens Received by DeFi Platforms Calculated by Purchasing Power Parity Per Capita

Weighed ranking based on DeFi activity in various countries. Assuming two addresses from different countries transfer tokens of the same value to Uniswap, the country with lower Purchasing Power Parity (PPP) per capita will have a higher ranking.

2. Total Value of Small Transactions Received by DeFi Platforms

Measures DeFi activities of cryptocurrency retail investors. Small transactions refer to trades below ten thousand US dollars, recording the total value of tokens sent to DeFi protocols in small transactions by each country, with weighting based on Purchasing Power Parity per capita.

3. Personal Deposits on DeFi Platforms

Ranking based on countries with the highest DeFi transaction volume, taking into account the ratio of DeFi transaction volume to existing internet users in that country. Assuming two different countries have equivalent deposits on Uniswap, the country with fewer internet users will have a higher ranking.

Global Ranking of DeFi Adoption

Unlike cryptocurrency adoption being highest in emerging markets, DeFi adoption is primarily driven by high-income countries. The top-ranking countries are the United States, Vietnam, Thailand, China, and the United Kingdom, with Hong Kong and Togo ranking 19th and 20th respectively.

Network Traffic of DeFi Protocols in Various Countries

From April 2019 to June 2020, major traffic came from North America in dark green, while Western Europe in light green has steadily increased since September 2019, and traffic from Central and South Asia in yellow started to increase after June last year.

DeFi Still Dominated by Large Traders

Chainalysis points out that large DeFi traders still make up the majority, with transactions over $10 million accounting for over 60% of DeFi transactions in the second quarter of this year.

Previous reports on "Global Cryptocurrency Adoption" suggest that emerging markets are driving cryptocurrency adoption due to factors such as currency depreciation and high costs of fiat cross-border remittances, while DeFi adoption in this article is mainly driven by experienced traders and institutional investors.

Chainalysis believes that the reason the top adopters of DeFi are high-income countries is due to this. However, based on 2020 data, both Thailand and Vietnam fall into the lower-income bracket in terms of annual income, indicating there may be other factors driving the adoption of DeFi in these countries.