Brazil and Argentina Present in Chainalysis Defi Adoption Index

Brazil and Argentina are present in the recently issued “Chainalysis Global Defi Adoption Index,” which measures how much a country is immersed in decentralized finance markets. These two countries occupy ranks 17 and 16 on a worldwide level. The index takes several factors into consideration and found that in contrast with the current cryptocurrency adoption index, defi is dominated by big investors seeking alpha opportunities in new markets.

Brazil and Argentina Top Latam Defi Adopters

Brazil and Argentina, two of the most developed economies in Latam, are present in Chainalysis’ defi adoption index. The new report seeks to quantify and locate the countries where decentralized finance (defi) technologies have penetrated the most. The two nations occupy 17th (Brazil) and 16th (Argentina) places in the top 20 countries with the most defi adoption. Chainalysis’s blog post explains that this index takes three factors into consideration, ranking 154 countries in each of these categories.

These three factors are on-chain cryptocurrency value received by defi platforms weighted by PPP (purchasing power parity) per capita, the total retail value received by defi platforms, and individual deposits to defi platforms. The first country in the index is the U.S., followed by Vietnam, Thailand, China, and the U.K.

Defi Thrives in Consolidated Crypto Markets

Chainalysis found that adoption of these technologies is happening in countries with developed cryptocurrency markets, differently from what the global cryptocurrency adoption index has shown. The report states:

Many of the countries ranking highest in grassroots DeFi adoption are those with high raw volumes of cryptocurrency value moved, both currently and historically. These tend to be middle to high-income countries or countries with already-developed cryptocurrency markets.

This seems to indicate that, unlike centralized cryptocurrency alternatives, these tools are being harnessed by more experienced traders. This assumption is backed up by transactional data that shows 60% of the transactions made in decentralized platforms move more than $10 million dollars.

Chainalysis concluded that users of these tools are experienced traders that are seeking more exotic offerings in new markets. In this sense, David Gogel, Growth Lead at dydx, a decentralized finance protocol, told Chainalysis:

Right now, DeFi is targeted towards crypto insiders. It’s people who have been in the industry for a while and have enough funds to experiment with new assets. In the long run, as ETH gas prices fall, it’ll become accessible to more people.