There has been a drop in European crypto users despite worldwide figures soaring to 417.5 million, according to data acquired by Finbold.
The drop has coincided with the region’s enactment of the Markets in Crypto Assets (MiCA) law. The law aims to create a legal framework designed for the market of crypto assets. The content of the law has been dubbed to act as the global benchmark.
Crypto users in Europe dropped by 12 million, from 2022’s figure of 43 million, with Asia leading the way with 260 million users as of May 2023, marking a staggering 100% growth from the previous year’s figure of 130 million.
North America follows with 54 million users, with the breakdown of ownership in relation to population per country indicating that Thailand ranks first in 2023, with a share of 9.32%, India is second with 7.23%, followed by Brazil at 6.98%, with the UK also recording a figure of 5.52%.
The cryptocurrency sector continues to face hurdles such as regulatory ambiguity and a prolonged downturn, hindering its path toward mass adoption, however, despite the challenges the industry has experienced significant growth in terms of user numbers over the past year.
According to the research report, “Despite the crypto sector facing one of its most challenging phases, marked by a sustained bear market, the global user growth is impressive.
“Given that the growth has occurred in the wake of high-profile incidents such as the FTX crypto exchange collapse and the Terra (LUNA) ecosystem crash, partly resulting in an erosion of trust within the sector.”
Various jurisdictions, including the United States, appear to be accelerating a crackdown on the sector and following in Europe’s footsteps. For instance, the Securities and Exchange Commission (SEC) is currently engaged in high-profile cases likely to discourage investor involvement.
Despite these fears, the growth in crypto user numbers can still be seen due to several factors, including the fear of missing out, or FOMO, phenomenon and mainstream adoption.
As the cryptocurrency market looks to recover from the ongoing downturn, the number of users will likely grow again, especially led by regions that enact friendly regulations.
The user count might also receive a boost from a potential increase in demand for cryptocurrency among banks and financial institutions and untapped potential in emerging economies.
