The United Kingdom has established itself as a prominent global player in the cryptocurrency economy, as indicated by a recent study. This study, unveiled by blockchain analytics firm Chainalysis in its 2023 Geography of Cryptocurrency report, also reveals the UK's position as the leading cryptocurrency hub in Central, Northern, and Western Europe (CNWE) in terms of raw transaction volume. Last year, CNWE ranked as the world's second-largest crypto economy, second only to North America, with a 17.6% share of global transaction volume and nearly $1 trillion in on-chain value generated between July 2022 and June 2023.
Notably, the UK tops the list of largest crypto economies in CNWE and ranks third globally in terms of transaction volume, trailing only the United States and India. In 2022, the UK recorded approximately $252.1 billion in cryptocurrency transactions. Other significant crypto economies in CNWE include Germany and Spain, with $120 billion and $110 billion in crypto transactions, respectively. They are followed by France, Netherlands, Italy, Switzerland, Sweden, and other major crypto players.
The surge in crypto adoption in the UK can be attributed to cryptocurrency regulations. Even before this recent recognition, London was identified as the world's most crypto-friendly city for crypto businesses, surpassing Dubai and New York. The UK government has been actively working on regulatory frameworks, including the Financial Services and Markets Bill, which incorporates crypto assets into existing financial services legislation and regulates stablecoins like Tether. Furthermore, the Financial Conduct Authority implemented the Financial Promotions Regime in October 2023, establishing regulatory standards for crypto firms when promoting their services to investors. In September 2023, the Crypto travel rule was also adopted, requiring UK crypto asset businesses to verify and share specific information about crypto asset transfers.
In addition to the CNWE report, Chainalysis also released an extensive report on Eastern Europe, ranking it as the fourth-largest crypto market, expected to handle $445 billion in crypto transactions between July 2022 and June 2023, accounting for 8.9% of global transaction activity.
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