Spain, Brazil, and Argentina were three of the 20 countries with the most profits from cryptocurrencies. The gains made by Colombia, Mexico, and Venezuela reached less than 1% of the total.
Spain and five Latin American countries received USD 10.7 billion in profits from the sale of Bitcoin and other cryptocurrencies by 2021. In that way, they ranked among those nations whose citizens got the most benefits from those assets. Latin America accounts for 6.62% of the global profits recorded, estimated at over USD 162,700 million.
The latest report from Chainalysis indicates that the distribution of cryptocurrency earnings reached those figures over the past year. According to the study, global profits totaled USD 32.5 billion in 2020 but increased by 400% in 2021. Last year, there was a great boom in the cryptocurrency market, whose capitalization almost hit USD 3 billion. That occurred along with the all-time high of Bitcoin, close to USD 69,000.
The United States leads the countries with the highest gains in cryptocurrencies (around USD 46,954 million), 28.9% of the total. The United Kingdom (5.01%), Germany (3.58%), Japan (3.38%), and China (3.11%) complete the top five list.
Spain occupies 11th place with earnings of USD 3,339 million, representing 2.1% of the total. It precedes Brazil, which ranks 15th with USD 2,562 million, and Argentina is in 20th place with USD 1,866 million.
The other three Latin American countries in the top 50 are Mexico, Venezuela, and Colombia, each with less than 1% of the total. The first two exceeded USD 1,000 million in profits, while Colombia reached USD 787 million.
The Earnings in Cryptocurrencies Exceed Traditional Measures of Economic Progress
Chainalysis indicates that collective cryptocurrency investment performance in many countries exceeds rankings on traditional measures of economic prosperity, like Gross Domestic Product (GDP). The report cites that Turkey is 11th in GDP with USD 2.7 billion but 6th in cryptocurrency gains with USD 4.6 billion.
Vietnam occupies 25th place in GDP at USD 1.1 trillion but is 16th in cryptocurrency earnings at USD 2.7 billion. In Latin America, Venezuela stands out in 78th place in GDP with USD 144 billion. However, it is number 33 in realized cryptocurrency gains with USD 1.1 billion.
People use cryptocurrencies differently in Latin America, depending on the country. For example, Venezuelans turn to crypto-assets out of necessity, but Brazilians buy them to speculate and save.
The most recent Chainalysis report highlights that both countries show marked inequalities in market maturity. That leads to differences in the use of cryptocurrencies and P2P platforms, the latter of which is higher in Venezuela in percentage terms.
The Brazilian market consists of much larger transactions with a higher share of activity on DeFi platforms. Meanwhile, Venezuelans conduct smaller transactions and have higher P2P activity, indicating greater need-driven adoption.
Cryptocurrencies play an increasingly relevant role in the economy, and citizens of many countries are aware of that. Many people invest in them to store value or hedge against inflation. Some others even use them to circumvent the effects of international restrictions.
By Alexander Salazar
