In the first six months of this year, when cryptocurrency booster President Donald Trump reversed the US government’s precautionary resistance to cryptocurrencies, transaction volumes in the US increased by about 50% to surpass $1 trillion, according to a TRM Labs report released Tuesday.
The rapid rise was multifaceted, with institutions jumping into stablecoins and others into newly regulated products such as exchange-traded funds (ETFs), as well as the comfort level rising for investors as U.S. regulators and lawmakers began taking steps to set rules for the industry.
When the U.S. Securities and Exchange Commission and banking regulators kept cryptocurrencies at arm’s length from the financial system during the Biden administration, the constant refrain from industry lobbyists was that the government was chasing innovators overseas. Trump promised to make the United States the “cryptocurrency capital of the world” when he took office.
The 50% increase in the United States can be attributed in part to the “more favorable political and regulatory climate,” said Ari Redbord, head of global policy at TRM.
“It is difficult to say to what extent this is due to the return of offshore activity inland, but the trend is consistent with growing confidence, clearer rules and renewed capital formation in the US market,” he said.
TRM Labs, a digital asset analytics firm, maintains a country-by-country adoption index of global crypto activity, weighting it with economic factors that downplay the high transaction volume that is expected to be more associated with higher-income countries. India has been at the top of the list for three consecutive years, a period of strong growth for cryptocurrencies globally.
Pakistan, the Philippines and Brazil completed the rest of the top five.
In the United States, there was a sharp divide in interest in cryptocurrencies surrounding last year’s presidential election. In the six months since then, web traffic to virtual asset service providers increased 30%, according to the report. As of July this year, the White House issued executive orders directing friendly crypto policies; the SEC established a crypto working group with the same goal; Congress passed a new law to regulate stablecoin issuers; and significant progress was made on a broader market structure bill, which passed the House of Representatives but currently faces a roadblock in the Senate.
