The potential of digital currencies to transform the current financial order is becoming more evident in a variety of economic relations worldwide. The nascent crypto sector is thriving, with virtual assets like <a href="https://blog.cryptoknowmics.com/why-bitcoin-stands-differently-on-cryptocurrency-exchanges/">bitcoin</a> now seen as legitimate alternatives to central bank currencies.

These emerging financial instruments have become significant flashpoints for global competition. Nations in the West and the Central and Southern Asia and Oceania (CSAO) region are seemingly engaged in a growing digital currency war.

Asian giant China has already made headway in forging a Central bank digital currency (CBDC) ahead of Western heavyweights. The result has been a <a href="https://www.cnbc.com/2021/01/21/op-ed-a-new-global-arms-race-in-digital-finance-is-heating-up.html">new global arms race</a> in digital finance, where many Western world powers have revamped efforts to lead in decentralized blockchain technology.

Despite the regulatory uncertainty in some CSAO jurisdictions, leading crypto businesses and venture capital firms have been eyeing the lucrative Asian market in recent times. This article explores the ongoing race for dominance in the crypto sphere and how the Asia-Pacific market could eclipse Western countries in terms of overall adoption.
<h2>The Future of Digital Currency Competition</h2>
Huw van Steenis, a Senior Adviser at UBS Group, sees the intensifying war for dominance in the Fintech industry as having far-reaching implications. He believes that the future of money will center on CBDCs and decentralized tokens like bitcoin.

Countries that are quick to develop the needed infrastructure and technology could have a massive advantage in the emerging era of digital finance. Many <a href="https://decrypt.co/17662/eighty-percent-of-central-banks-are-working-on-digital-currencies-report">central banks</a> and Fintech startups are currently working to advance innovation in digital currencies, CBDCs, and payments to improve the current financial system.

According to David Marcus, head of private digital currency project Diem, failure by the US and its Western counterparts to lead innovation in the digital finance sphere leaves a vacuum that other countries could exploit.

China is currently finalizing the development of a digital version of its sovereign currency, which could challenge the US dollar’s position as the reserve currency of the global economy. The e-Yuan could also undermine the West’s ability to enforce sanctions across the globe. 

While the US and other Western countries have lagged in creating CBDCs, they have enjoyed significant success in proliferating private digital currency development intending to revolutionize finance.
<h2>Asia Emerges as the Hub for Global Crypto Growth</h2>
Numerous developers from North America and Western Europe have established themselves as new tech superstars by building compelling crypto and blockchain tech innovations. Even so, the highest levels of crypto adoption have been recorded in CSAO, demonstrating that Asia is leading the charge in the digital finance revolution.

According to a regional Chainalysis report published last year, cryptocurrency transactions in Central and Southern Asia are growing rapidly, outperforming mature markets in the West. The <a href="https://blog.chainalysis.com/reports/central-southern-asia-oceania-cryptocurrency-geography-report-2021-preview">2021 Global Crypto Adoption Index</a> showcased that the Asian continent is leading global cryptocurrency adoption among retail investors.

Per analysis from the leading blockchain analytics firm, P2P monetary systems primarily spurred growth over the past year in emerging markets in the region. Smart money adoption of crypto across the Asian market also skyrocketed over the past year, rivaling mature US and Western Europe markets powered mainly by institutional investors.

The highest percentage of people owning digital assets now come from Asian nations, per the Chainalysis report. The data indicates that key countries in Asia, such as Pakistan, Vietnam, and India, registered the highest growth in crypto activity between July 2020 and June 2021.

This study reveals that Asia has played a more significant role in the overall adoption of virtual currencies in recent months, despite Central, Northern, and Western Europe remains the world’s largest crypto economy.

The mounting appetite for the digital asset class in the CSAO region has been largely catalyzed by a lack of trust for sovereign currencies and the prevalence of massive unbanked populations. Moreover, the emergence of new crypto-asset frameworks in Eastern markets offers lower transaction fees that facilitate strong grassroots adoption.
<h2>Global Crypto Exchanges Are Flocking to Asia</h2>
Over the past year, Western exchanges have made significant efforts to gain a footing in the Asian market. One of the key factors that have allowed cryptocurrency activity to expand swiftly across Asia-Pacific is the crypto-friendly landscape in the region.

According to a <a href="https://alphapoint.com/wp-content/uploads/2021/03/messari-report-asia-crypto-landscape-1.pdf">Messari report</a>, leading crypto nations like Singapore, Japan, and South Korea boast deep liquidity pools that have helped transform the region into a top crypto spot market. Moreover, the growing crypto craze and increasing regulatory clarity are allowing Asia-Pacific to emerge as the new hub for crypto growth.

Exchanges originating from the West such as <a href="https://markets.businessinsider.com/news/stocks/coinbase-goes-live-in-japan-in-partnership-with-banking-giant-mufg-10458509">Coinbase</a> and Kraken are adopting an Asia-first policy. These global trading platforms are looking to build new crypto infrastructure and cash in on the great boom in crypto adoption seen across the region.

Major exchanges headquartered in Asia have not been left behind, with players such as Binance looking to <a href="https://www.forbes.com/sites/robertolsen/2021/12/15/binance-to-launch-crypto-exchange-in-indonesia-with-countrys-largest-telecom/?sh=587db98d35ca">revamp</a> their dominant presence in the lucrative market.
<h2>Conclusion</h2>
Singapore, Japan, South Korea, and other Asian countries continue to show less resistance towards the emergence of crypto as they look to improve existing domestic payments systems. This trend has seen much of the region pivot toward digital assets to combat strict foreign exchange policies, runaway inflation, and capital controls. 

As peer-to-peer <a href="https://www.cryptoknowmics.com/news/the-era-of-definft-has-come-asia-nft-and-defi-conference-concludes-successfully">crypto and NFT exchanges</a> continue to take root in Asia, the CSAO market stands to become the next hotbed for crypto adoption at the expense of Western nations.

Is Asia Preparing to Adopt Cryptocurrency Before the West?

The nascent crypto sector is thriving, with virtual assets like bitcoin now seen as legitimate alternatives to central bank currencies.

Adam is an outgoing young lad who likes adventures and discovering new things.Despite his boring life, he loves writing about cryptocurrencies and exploring what blockchain technology can do for the coming digital world where all adventures will be virtual.

Is Asia Preparing to Adopt Cryptocurrency Before the West?

Top Picks