Asia Emerges as Key Cryptocurrency Market Growth
Despite recent price corrections in cryptocurrencies, particularly Bitcoin, it remains one of the best-performing assets. This is closely tied to the demand for cryptocurrencies in Asia.
For example, Hong Kong recently listed six cryptocurrency ETFs (Exchange-Traded Funds), while the Australian Securities Exchange plans to approve its first batch of physically-backed Bitcoin ETFs before the end of the year. In addition to financial products, many Asian countries have become driving forces behind the growth of the cryptocurrency market through gaming and blockchain technology development.
The majority of investors in Asia are long-term cryptocurrency enthusiasts who have experienced multiple market cycles. Some have joined the cryptocurrency market later, from South Korea to Australia, where both small traders and whales have established unique ecosystems. Bloomberg recently analyzed the investment status and trends in the cryptocurrency industry in various Asian countries.
Hong Kong: User Preference for High-Risk Investments
Patrick Pan, CEO of digital asset platform OSL, stated in an interview with Bloomberg that individual investors in Hong Kong prefer to use leverage in their trades and have a preference for high-risk and alternative investment products such as cryptocurrencies. Pan also pointed out that these investors are easily influenced by social media and Key Opinion Leaders (KOLs) related to cryptocurrencies.
In fact, Hong Kong only opened up legal investments in cryptocurrencies for individual traders last year and has actively established regulations for cryptocurrency exchanges and related companies. On April 30th of this year, six cryptocurrency spot ETFs were officially listed for trading in Hong Kong, with a total trading volume of approximately $11 million on the first day. The Ethereum spot ETF was approved before the United States, marking a historic milestone.
South Korea: Popularity of Altcoins and Blockchain Games
Bloomberg points out that the South Korean won has recently become the most commonly used currency for cryptocurrency transactions in South Korea, surpassing the US dollar. According to data from the analytics platform CryptoQuant, altcoins are particularly popular among Korean investors, accounting for 80% of the trading volume on Korean exchanges.
In addition, many individual investors are enthusiastic about blockchain games that use cryptocurrencies or NFTs as asset representations. Charles Pyo, founder of Web3 product development company AI3, stated that mainstream game companies in South Korea, such as Nexon Games Co. and NCSoft Corp., are planning to launch new “play-to-earn” games to attract more gamers to the cryptocurrency field.
Japan: Gradual Relaxation of Cryptocurrency Industry Regulations by the Government
The Japanese government is actively cultivating Web3 companies and gradually relaxing regulations regarding cryptocurrency listings, taxation, and allowing venture capital firms and other investment funds to directly hold cryptocurrencies.
Financial holdings company Nomura Holdings and other financial institutions in Japan are also actively expanding the Japanese security token market by tokenizing corporate bonds, securitized real estate, and other financial products.
However, overall, Japanese regulations are still relatively strict. For example, mutual funds cannot be used to hold cryptocurrencies, including Bitcoin ETFs. Cryptocurrency analyst at Nomura Holdings also pointed out that Japanese financial companies are relatively conservative in participating in activities such as “cryptocurrency custody services” because they want to stay away from anything that has not received “clear” approval from regulatory authorities.
Jasiyu Jia, a blockchain analyst at Deloitte Japan, remains optimistic about the development of the cryptocurrency field in Japan. He analyzes that gradually improving laws and policies, such as the Stablecoin Bill in Japan, and the abundance of game and entertainment intellectual properties have paved a clear path for the development of the cryptocurrency field in Japan, indicating an imminent explosion in the Japanese blockchain industry.
Further Reading:
Rising Development of the Blockchain Industry in Japan! What Makes Games and Anime IP Stand Out? Analysis of the Three Major Advantages that Made a Breakthrough
Australia: User Preference for Ethereum over Bitcoin
Individual investors in Australia have a strong preference for Ethereum. Bloomberg states that some people even completely avoid investing in Bitcoin and instead choose Ethereum or other cryptocurrencies. According to a survey by cryptocurrency exchange Kraken, Australian users’ cryptocurrency wallets have an average of 59.4% Ethereum and 17.7% Bitcoin, which is significantly different from the global ratio.
An Australian trader interviewed by Bloomberg explained that they have more confidence in Ethereum because its price increase has been less dramatic compared to Bitcoin, making it more stable. Additionally, many altcoins are deployed on the Ethereum blockchain, making its ecosystem more robust.
Sources:
CoinDesk, Bloomberg, CNBC