What made the west the powerhouse of the globe is the edge that they hold in terms of innovation and technology. The west didn’t just build those technologies but they embraced it. Even when Asia was rising during the ’80s and the ’90s, most economists were behind the idea that the west will act as the head and Asia will act as the body, referring to the idea that the west will still bring all the innovation and ideas while Asia will end up being the place where the end product will be built. But when it comes to blockchain and crypto, Asia is beating everyone in the game.
Proliferation of Exchanges
One thing that is plenty in Asia, especially in China, Korea, Japan, and southeast Asia, is the proliferation of exchanges. Let’s face it, most businesses don’t accept crypto. Being able to convert crypto into fiat is very essential to most members of the community and Asia happens to have a lot of them. In fact, more than 40. Even Binance, based out of Malta, the biggest cryptocurrency exchange in the world, is run by a Chinese company. This drives up the volume of trade that happens in crypto, indirectly leading Asia to dictate the price most of the time.
Around two-thirds of the world’s hashrate behind Bitcoin originates from Asian companies, particularly Chinese companies. 11 of the 17 largest mining pools distributed by Hashrate are based in Asia. The extremely low cost of electricity in Asia compared to other regions is one of the major driving factors of the region’s dominance in cryptocurrency mining. The cost of a one-kilowatt hour in Germany and the UK is 33 cents and 24 cents in the USA, while one-kilowatt hour in China is on average 9 cents. This is the reason why Asia dominates in cryptocurrency mining.
Huge Human Resources
This is very important. Every person is a potential user and since people in Asia are getting connected to the internet at an exponential speed, each new person connecting to the internet is a potential crypto user. To put it into perspective, if 1 billion people in China had access to the internet and 5 percentage adopted crypto, that would still be comparable to the population of the UK. The second thing about Asia’s population is the share of the younger generation. They more likely adopt new and riskier technologies like crypto.
Reasonable use cases
Asia represents a huge unbanked population. One of the reasons is the lack of robust banking infrastructure in many of the rural areas. Crypto can serve these people all their banking requirements. All one needs is a mobile phone and internet connection. Also, Asia represents a large market for remittance which is currently ineffective, slow and costly. Remittance using crypto is instant and really cheap. Bitcoin can really replace USD as a reserve currency. The problem with current alternatives like Chinese Yuan is the volatility and manipulation by the government, and Bitcoin cannot be manipulated like Yuan, which makes it a perfect candidate, especially for countries whose economies are at the mercy of the USD.
The governments in South Korea, Hong Kong, Japan, and even China have all shown varying levels of support for cryptocurrencies. Japan, Thailand, and South Korea have already introduced many laws, giving investors more confidence. Other countries like India are in the process of bringing laws regarding crypto. These governments are genuinely interested in the future of crypto and their countries’ role in the earlier backlashes were the result of fear of people losing money to scams. The laws in Asian countries are more specific and are intended to stop fraud and illegal acts, at the same time allowing innovation and growth.
What made Asia so important in the cryptosphere is its early adoption. The future is uncertain but it seems like this time in history, Asia is going to lead the charge.
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