Unlike many countries towards the west, Asian governments have been more supportive of the crypto industry. From India to Thailand and Vietnam, investors of both individual and institutional nature have contributed to introducing and regulating digital assets in the economy.
The problem with the complete adoption of cryptocurrency is the inherent instability of virtual assets like Bitcoin (BTC) and Dogecoin (DOGE). However, cryptos also offer benefits through an inclusive financial system, eco-friendly transactions, and decentralized exchange platforms.
A History of Cryptocurrency in Asia
- Digital assets were safe from the financial markets before the pandemic. There was a negligible correlation between the equity markets in Asia and cryptocurrencies.
- Therefore, people began to think more favorably of digital assets as instability concerns were addressed.
- During the pandemic, many people began staying indoors. In combination with convenient financing conditions and low rates of interest, this propelled the world of crypto into a Trillion-Dollar industry.
- Within a year and a half, the net worth of the industry stood at $3 trillion.
- In the following year, the industry shrunk to $1 trillion due to an increase in interest rates by the Central Bank.
Watching out for Instability
Due to the recent downfall of many cryptocurrencies like Bitcoin, Ethereum, and Solana (SOL), Asian governments are a little skeptical. This is preventing the complete adoption of crypto as a viable currency.
Therefore, governments of countries like India and Thailand are gearing up on regulatory frameworks. This is both good and bad. Drafting regulations implies a willingness to adapt to newer technologies. However, it also means stricter laws and restrictions on crypto trading.