Japanese Yen Overtakes the U.S. Dollar in Bitcoin-Fiat Transactions

Japan, has once again proven to be the hub of cryptocurrency according to a recent bitcoin index released by cryptocurrency data site CoinHills. According to data provided by CoinHills, the Yen—Japan’s native fiat currency—is now the most used fiat currency when trading with bitcoin.

In its analysis, CoinHill published on Monday, Dec. 24, that the Japanese Yen made up 48.34% of the market share of bitcoin-fiat trading pair. This was closely followed by the US dollar which accounted for 45.89 percent of all bitcoin-fiat trades.

Japanese Yen and US Dollar Dominate BTC transactions

At closer look, the combined market share of Yen and the US dollar comes to over 92 percent. This goes to show the concentration of crypto activities around the two currencies.

Japan became a refuge for crypto operators shortly after the China banned cryptocurrency operations in the country. It soon became the Asian capital of cryptocurrency and went a step further to regulate the crypto space through its Financial Service Agency (FSA). Over a dozen cryptocurrency exchanges were licensed and others were allowed to operate thereby boosting the bitcoin-yen transaction volumes.

The United States on the other boast major exchanges like Coinbase Pro (formally GDAX) which allows the users purchase bitcoin using the US dollar and also withdraw in the currency.

South Korean Won lead the others

South Korean Won (KRW) was the third most traded currency with the BTC claiming 5.06 percent of the entire BTC-fiat transactions or 70 percent the market share outside the Yen and the Dollar.

South Korea is one of the few countries that legalized cryptocurrency transactions albeit strict rules that require exchanges to have partnerships with regulated financial institutions in the country.

The Euro (EUR) completed the top four position with 1.3 percent of BTC-fiat paired transactions. European countries like Malta and Switzerland have become a hub for blockchain and cryptocurrency startups some of which allow user to transact BTC-EUR pairs. As Smartereum reported, many cryptocurrency users in the UK had to conduct crypto transactions through the EUR until Coinbase provided its UK services which allowed UK residents to buy bitcoin and other cryptocurrencies using the British pounds (GBP).

Crypto Adoption in the United States

Cryptocurrency experts believe that the United States has the potential to lead in the emerging blockchain and cryptocurrency space if it can settle for favorable regulations. During the CryptoBlockCon event which held in Las Vegas earlier this month, Ben Marks the founder of blockchain VC firm Blocktrade, told Mahesh Sashital of Smartereum that U.S. regulators were cautious with their regulation of the cryptocurrency space in other not to stifle innovation in the space.

Last week, two US lawmakers proposed a bi-partisan bill to redefine cryptocurrency terms like digital token and remove them from the jurisdiction of federal securities laws. The rationale behind the bill is to update the old definitions and “[provide] the certainty American markets need to compete with Singapore, Switzerland, and others who are aggressively growing their blockchain economies.”

The country will, however, hope to avoid major losses caused by cryptocurrency scams or crypto-related cyber-attacks as witnessed in Japan and South Korea in the past. Japan’s FSA for its part have strengthened regulations since the notorious hack on Coincheck exchange in January. The country has progressed from that time as Michael Ou, CEO of crypto wallet company CoolBitX points out. “It seems that Japan lives months or years ahead of the rest of the world” he said.

He explained:

“While news of government intervention makes headlines, private companies in Japan are also working hard to improve the crypto market: here are more than a dozen Japanese cryptocurrency exchanges. With a growing number of Japanese businesses accepting cryptocurrencies as payment, and with many startups in Japan’s thriving tech scene, it’s fair to guess that continued investment will inspire continued innovation.”

Solomon Sunny is the market reporter for Smartereum, one of the global leaders in Ethereum, blockchain and currency news. He produces technical price updates on digital currencies and writes recent developments about blockchain.

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