Every four years (usually), the world comes together in a celebration of sport and competition at the Olympic Games. In the spirit of Tokyo 2020, let’s look at countries that are deserving of gold medals across different spheres of the cryptocurrency and blockchain space.
The variety of sports featured at the Olympics have changed over the years, and the current summer Olympics in Japan features a total of 33 different sports. Exciting competitions like skateboarding and surfing were added for Japan as the global showpiece continues to evolve and adopt different sports.
The cryptocurrency and blockchain space is similar in this regard. Many different working parts make for a colorful community both united and divided by their preferences of cryptocurrencies and blockchain platforms.
Let’s take a look at which countries and institutions take home gold medals in their respective crypto and blockchain codes.
Gold for Bitcoin adoption goes to… El Salvador
Sports often have fans cheering for the underdog and El Salvador has emerged as one of those lesser-known players that have burst onto the global stage in 2021. The Central American country grabbed headlines this year as it officially became the first in the world to recognize Bitcoin as legal tender.
Without delving too deep into the specifics, El Salvador’s congress voted to pass President Nayib Bukele’s Bitcoin Law which recognizes Bitcoin (BTC) as legal tender alongside the United States dollar, with 62 of a total 84 votes in agreement with the new legislation.
The law allows citizens to pay for goods and services in Bitcoin, and Bukele also stated that the Salvadoran government will guarantee the convertibility of BTC into USD at the time of any given transaction. The government plans to airdrop $30 worth of BTC to every citizen later this year.
There have been critics of the law change both locally and abroad, but the overall sentiment seems positive for the adoption of Bitcoin and a change of perception toward the preeminent cryptocurrency.
Nevertheless, there are a few final hurdles that lie ahead for the country. Firstly, the International Monetary Fund has issued its own warning about the potential downsides of countries adopting Bitcoin that currently have unstable inflation rates.
Secondly, some citizens of El Salvador have also expressed their skepticism of the move. A survey undertaken at the beginning of July involving 1,233 citizens revealed that nearly half of the respondents knew nothing about Bitcoin. Of the poll takers, 20% agreed with the move, highlighting the need for an educational campaign to complement the progressive move to make BTC a legal tender in the country.
Change is often met with uncertainty and resistance, but in terms of progression and adoption, El Salvador takes the gold medal in this first category.
Switzerland takes silver in the category, thanks to its crypto-friendly laws that have boosted the use of cryptocurrencies and companies working in the space. The USA clinches the bronze medal thanks to the efforts of Miami’s Bitcoin-friendly mayor Francis Suarez, who’s been driving various initiatives to promote the use of BTC.
China leads the CBDC race, but anti-crypto policies lead to disqualification
China has been a powerhouse at the Olympics over the past two decades with its sporting program producing a fine pedigree of Olympic weightlifters, gymnasts, divers, shooters and martial artists. In the world of cryptocurrencies, the story is quite different.
China has taken a stern stance toward cryptocurrencies and has continued this policy in 2021, with its outright ban of mining completely rebalancing the Bitcoin mining ecosystem as a result.
Interestingly enough, the nation is far ahead of the world when it comes to the race to develop a fully-fledged central bank digital currency, or CBDC. Over the past 18 months, China has piloted and rolled out significant testing of its Digital Currency Electronic Payment, or DCEP.
Colloquially known as the digital yuan, citizens began testing the facility through lotteries that award a small number of participants in various cities with digital yuan, which they could use through a mobile app to pay for goods and services at thousands of participating vendors.
There is no denying that China has blazed the trail for the development, testing and roll-out of its CBDC. In the same breath, the DCEP is a government-controlled program, and the specifics of the technology and systems powering the digital yuan are shrouded in mystery.
However, China’s recent ban on mining in different regions and its zero tolerance of cryptocurrency exchanges means that despite its well-developed CBDC program, it falls out of the reckoning for a medal. Luckily, a number of other countries have also made significant strides in developing their own CBDCs.
In the world of sports, fans often get behind the underdog, and this is certainly the case with the Bahamas and its Sand Dollar CBDC. The country has made significant strides with the development and testing of its very own CBDC and became the first country to go live in October 2020.
The Sand Dollar ecosystem continues to onboard more local banks and financial institutions, paving the way for widespread adoption of the CBDC and a fully digital payment environment. The Bahamas is the deserving recipient of the gold medal in this category.
Sweden has begun its first trial of pilot testing the e-krona CBDC with a couple of local banks and external participants. As it continues testing its system with local financial institutions, Sweden earns the silver medal in this category.
North America in the race for gold in Bitcoin mining
China was undoubtedly the gold medal incumbent of Bitcoin mining but this is quickly changing in 2021. Recent estimates saw China account for more than 70% of the global hash rate before various mining operations were forced to shutter in June.
Those firms that were able to quickly look for greener pastures would welcome their mining equipment. While various countries in Asia would be the closest locale to relocate to, North America is quickly becoming the new hub of cryptocurrency mining.
Research from the Cambridge Centre for Alternative Finance shows that the hash rate of American-based miners has steadily been on the rise over the past year and the latest regulatory move in China has only accelerated that point.
The Cambridge Bitcoin Electricity Consumption Index world map has yet to fully reflect the data from China’s regional mining bans in June, in order to get a better understanding of how the Bitcoin mining hash rate’s geo-distribution has changed. The latest map shows the distribution as of March 2021.
Nevertheless, from August 2019 to March 2021, the U.S. saw an increase in its contribution to the global hash rate from 4% to 16%, making it second to only China in terms of hash rate. This is largely due to a concerted effort from major mining operators in America steadily increasing their hash rate by acquiring new equipment during this period.
Kazakhstan has also opened its doors to relocate Bitcoin miners from China and has seen its share of the Bitcoin hash rate climb to around 8% of the global rate, according to Cambridge’s recent report.
China’s share of the global hash rate has dropped below 50%, while the United States’ has climbed. This picture, however, has still not factored in the major relocation of mining operations out of China.
It might be too early to give the U.S. the gold medal for Bitcoin mining, but the country seems to be on track to take over in the leaderboards if it continues at the same pace. China’s mining clampdown results in a disqualification, so the U.S. becomes the new gold medallist in this category.
Kazakhstan swoops in to take silver with its 8% contribution to the global hash rate, while Iran grabs the bronze medal with its 4.6% share. Canada and Malaysia just miss out on the podium in the category.
The regulatory race goes down to a photo finish
When it comes to progressive regulation that is driving cryptocurrency adoption and use, there are a number of countries that are vying for a crypto gold medal and can boast to have developed regulatory parameters that are helping the industry thrive in their locales.
Malta has positioned itself as the blockchain island for a few years now and has attracted a number of the world’s biggest cryptocurrency exchanges and other crypto service providers. The country’s regulatory package is attractive, as crypto holders do not have to pay capital gains, wealth, or inheritance tax on their holdings, but trading is subject to income tax.
Singapore is another country that has established comprehensive laws that have made it clear what cryptocurrency firms and service providers need to do in order to operate in the country. Singapore is also among a handful of countries that has zero capital gains tax on cryptocurrency income.
South Korea has long been a country with an avid cryptocurrency user base and often sees Bitcoin trading at prices far higher than the rest of the world. The country has since developed strict regulatory frameworks but has also driven a number of initiatives to foster various services powered by blockchain technology.
Switzerland is another strong contender in this category, given its progressive attitude toward the cryptocurrency and blockchain space. Earlier in 2021, the Canton of Zug finally rolled out its facility for residents to pay taxes in BTC and Ethereum (ETH).
Canada is featured prominently in this race, having become the first country to approve a Bitcoin exchange-traded fund (ETF). The launch of the first Bitcoin ETF in February 2021 was a huge success, with the Toronto Stock Exchange’s Purpose Bitcoin ETF seeing nearly $100 million in trade volume on its first day.
All in all, Canada has been hailed for its progressive regulatory environment for cryptocurrency use. Cryptocurrencies are classed as commodities, and their usage for goods or services is treated as barter transactions.
These five countries, therefore, end the crypto and blockchain regulatory race in a photo finish that’s hard to call. As we bring up the slow-motion replay, we can confirm that Canada can take the gold in this category for its broad range of crypto-friendly regulations, from ETFs to clear tax laws and favorable mining tariffs.
Malta takes silver, as its status as the “Blockchain Island” has waned somewhat due to a change in governmental leadership that had initially championed this cause. Singapore and South Korea share bronze in this category.
The U.S. takes gold for institutional adoption
The modern-day United States optimizes a capitalist society, and the disruptive nature of cryptocurrency has led some forward-thinking individuals, companies and institutions to move quickly to leverage the potential of cryptocurrencies and blockchain technology.
Enter MicroStrategy, a global leader in business intelligence services, which in 2020, pioneered a move to convert its fiat-based treasury holdings to Bitcoin. The company’s CEO, Michael Saylor, is a fierce Bitcoin proponent and has relentlessly acquired BTC since the firm’s decision to bank on the preeminent cryptocurrency in August last year.
MicroStrategy’s move is widely credited for influencing electric vehicle manufacturer Tesla and its founder Elon Musk to decide to begin investing in Bitcoin and, even at one point, accepting the cryptocurrency as a means of payment for its vehicles.
Cryptocurrencies have been touted as a disruptive force in the payments industry, and American firm PayPal looked to gain first-mover advantage by announcing that it would roll out cryptocurrency custody and payment services on its widely used platform.
American investment firms have also led the way in allowing a wider audience various ways to gain exposure to cryptocurrencies. None more so than Grayscale Investments, which has a number of cryptocurrency trusts that are valued at over $33 billion to date. Its flagship Bitcoin Trust is currently valued at over $24 billion alone.
These factors are more than enough to hand America another gold medal in the Crypto Olympics in the race for institutional adoption.
Canada takes silver in this category due to its crypto-friendly regulation and its progressive ETF laws that have seen it overtake its North American neighbor in that regard. Thailand walks away with a bronze medal here, as its oldest banking institution, Siam Commercial Bank, has committed $110 million to invest into the decentralized finance sector through its venture capital arm SCB 10X.
A number of countries fall into the disqualification category for their varying stances on cryptocurrency and blockchain technology.
In February 2021, Nigerians were caught off guard as the country’s central bank effectively barred local banks from servicing cryptocurrency exchanges. For a country that still ranks as number one for Google’s search of Bitcoin, the move was criticized both locally and abroad. Nigeria’s Securities and Exchange Commission had been developing crypto regulatory plans which were suspended as a result.
India is another country that has a checkered past when it comes to its attitude toward the cryptocurrency space. The country’s government has long been threatening an outright ban on the use of Bitcoin, but this is slowly changing with talk of asset classification providing proper regulatory frameworks and oversight for the burgeoning industry.
India’s banking sector is still at odds with the cryptocurrency movement, with some of the largest institutions reportedly cautioning customers about acquiring and using cryptocurrencies. It’s clear that mixed messages from India’s government and central bank in recent years have created a swathe of uncertainty that can only be addressed by proper education about the sector.
China’s recent ban on cryptocurrency mining in different regions of the country also sees it feature in this disqualification category, as the move caused major disruptions in the mining ecosystem, forcing operators to close up shop and look for greener pastures abroad.
The Chinese government also issued directives to local banks not to service businesses involved in the cryptocurrency industry, which is cause for greater concern. Cutting off integration with the traditional finance sector means that citizens in the country are robbed of the ability to access and use cryptocurrencies to their full potential.
Ray Schuetz received a Masters Degree in computer science from The University of Texas (Austin). Ray has been working as a full-time blockchain consultant for the past 3 years. In his spare time, Ray enjoys writing for EthereumCryptocurrency.com and other crypto news publications.