Bitcoin dominance has decreased more in the U.S. than in any other region, according to a new report from Chainalysis.
The world’s largest cryptocurrency by market capitalization saw its dominance slip by 6% between July 2021 and June 2022 in the U.S.—thanks, in large part, to the region accounting for more DeFi activity than any other.
On Thursday morning, the DeFi ecosystem had $53 billion worth of assets locked in various protocols, according to DeFi Llama. The category has lost more than $100 billion since the start of the year.
Even so, the U.S. accounts for 37% of all DeFi activity analyzed by Chainalysis, followed by 31% in Western Europe.
Under the DeFi umbrella, decentralized exchanges, or DEXes, account for the most value received and tend to be used primarily by professional and institutional investors.
After DeFi, NFTs rise in popularity
But NFTs lead the category for generating the most web traffic. It’s a sign that NFTs have been the main draw for mainstream customers to enter DeFi, according to the report.
And it’s not the only sign. Earlier this week, a Reddit executive said that the company’s Collectible Avatars NFT series has onboarded more than 3 million new Web3 users.
In terms of all crypto transaction volumes, DeFi and otherwise, the U.S. accounted for more than $1 trillion over the last year and is second only to Western Europe. That means in the past year, U.S. investors were involved in one in every five crypto transactions, according to the Chainalysis report.
Current market weakness seems to have focused project teams on very easing financial pain points, like mortgages, identity verification, and the tokenization of physical assets, Matt Van Buskirk, co-founder and CEO at crypto compliance startup Hummingbird, said in the report.
To that end, the U.S. and Western Europe have an advantage over other regions because of the deep talent pools of engineers and researchers.
“There are big concentrations of developer talent and academic interest in hubs like New York and London, so you see a lot of blockchain projects from those areas,” he said. “I’m advising people building great projects in places like Latin America, but it’s harder for them to find talent and funding without coming to somewhere like Silicon Valley.”
Stay on top of crypto news, get daily updates in your inbox.