Article by Chainalysis
Compiled by Chopper, Foresight News
Cryptocurrency is a global movement with entirely different interpretations depending on the observer. For Western asset allocators, it represents a technological upgrade, with tokenized assets poised to reshape asset trading models. For low-income workers in the Global South, it is a lifeline, as stablecoins enable rapid fund transfers and protection against political and economic instability. For ordinary people around the world, it is an alternative investment.
This year's regional report focuses on an extreme market cycle in crypto history. The reporting period spans from July 1, 2025, to June 30, 2026: during this time, Bitcoin first reached an all-time high, followed by the largest dollar drawdown in history, plunging $67,000 from peak to trough. The total crypto market cap halved, losing $2.1 trillion, marking the most severe bear market since the series of scandals in 2022.
As with previous crypto bear markets, growth in the crypto economy has slowed during this cycle, but the contraction has been minimal. Data shows that the global crypto economy (including platform inflows, domestic peer-to-peer activity, and cross-border transfers) contracted by only 1.6% compared to the previous period. Over the 12 months ending June 30, 2026, on-chain economic activity totaled $9.4 trillion, compared to $9.5 trillion in the prior reporting period (ending June 30, 2025).
Global crypto economic activity remains resilient during the bear market
In 2026, a more severe decline may occur. After the total market capitalization of assets is halved, trading volume must double to maintain the same level of capital flow. If crypto assets are used solely as investment instruments, the price drop in 2026 could cause a far greater reduction in global capital flow than in 2023. During the 2023 cycle, the total crypto market cap shrank by $300 billion, yet economic activity declined by 23%; in contrast, this time, with a market cap reduction of $2.1 trillion, economic activity decreased by only $0.1 trillion.
The growing diversity of real-world applications in the crypto industry has buffered market contraction.
Three regions achieved growth, led by Sub-Saharan Africa and Latin America.
Significant growth in small transfers
The majority of the global crypto economy stems from various platforms used by users for buying, selling, trading, lending, and transferring assets. We track this major segment to identify which types of users are driving on-chain activity. During the 2026 reporting period, inflows of small amounts to platforms saw significant growth: transfers under $100 increased by 78.4%, and transfers between $100 and $1,000 rose by 58.6%. Although retail user trading volume totaled only $273 billion—representing a modest share of the nearly $10 trillion in total activity—this demonstrates that ordinary retail users did not exit during the bear market.
Small transfers are growing faster.
Large institutional transfers demonstrated resilience even in a declining price environment. Transfers exceeding $1 million decreased by only 7.2% year-over-year—a minimal drop given the severe price decline. At the market’s lowest point, the value of their crypto holdings halved. As previously mentioned: when asset prices drop by half, maintaining the same capital volume requires doubling transaction volumes—and institutional capital flows weathered this challenge.
Cross-border stablecoin transfers experience explosive growth
The U.S. GENIUS Act, the EU’s MiCA regulation, and emerging regulatory frameworks introduced by Japan, Hong Kong, Singapore, and the UK are driving the adoption of stablecoins. Conservative estimates show that monthly cross-border stablecoin transfer volumes rose from $11 billion in January 2025 to $24 billion by June 2026, with the actual scale likely even higher. Over this period, total cross-border stablecoin transfer volume increased from $124.2 billion to $220.3 billion, a 77.5% rise. The average amount per cross-border transaction is approximately $3,000—not institutional-sized transfers, but typical everyday use cases: paying suppliers, sending remittances, or converting savings into assets to hedge against local currency risk.
Philip Gradwell, Tether’s Executive Vice President of Economics, said: “On-chain fund flows have become stable, occurring consistently through wallets rather than experiencing sharp spikes and drops. This is characteristic of trade and business activity, not mere speculation.”
Cross-border fund flows of stablecoins
All cross-border capital flows have origins and destinations, forming what trade economics refers to as capital channels. The top quarter of these channels account for 96.1% of cross-border stablecoin flows, a 70.8% year-over-year increase. As stablecoins become integrated into global commerce, capital is flowing into many previously dormant channels. Before the 2026 cycle, the total volume of the bottom three tiers of channels was only $260 million; in this cycle, it has reached $8.66 billion, with new capital channels rapidly emerging. The report identifies 4,708 newly established cross-border channels, collectively handling $26.4 billion in funds, with the majority of transactions conducted using the leading stablecoin, USDT.
Gradwell said: "The true value of USDT lies in the long-tail markets. Many economic groups that face high costs and limited access in traditional finance can use USDT. With an average transaction cost of just one cent, instant settlement, and only a smartphone required."
Stablecoin cross-border amounts grouped by cross-border channels
This cross-border statistic includes only transfers where the countries of both the sender and recipient can be confirmed. Transfers with unidentifiable wallet addresses or those masking one end of the transaction path are excluded from the count. Therefore, the actual global volume of stablecoin cross-border transactions is significantly higher than the reported $220.3 billion.
Peer-to-peer trading sees a significant surge
Various cryptocurrency platforms have faced a downturn, but peer-to-peer trading has surged逆势. Funds flowing to exchanges, DeFi protocols, and other commercial platforms declined by 4.3% year-over-year, dropping from $9.30 trillion to $8.90 trillion; meanwhile, direct transfers between individual wallets within the same country increased by 302.9%, rising from $56.8 billion to $228.7 billion. The share of peer-to-peer trading in relation to the combined total of both activities rose from 0.6% to 2.5%, with increases observed across all eight regions.
The percentage of P2P transactions has increased relative to platform service transactions in all regions.
Most transactions on the platform are exchanges or deposits, closely tied to cryptocurrency prices. When prices drop by half, the dollar value of the same number of transactions is also halved, and speculative trading volume declines along with market sentiment. Stablecoin payments, however, are unaffected: denominated in USD, transfer amounts depend solely on user demand and can occur normally regardless of market fluctuations.
The internal structure of the platform and peer-to-peer channels also differs. Even as total funds flowing into the platform declined, stablecoin inflows within the platform rose by 5.3%. Overall peer-to-peer trading of all assets dropped by 19.7%, but stablecoin trading surged by 377.7%. The core difference between these two channels lies in asset type: 96% of peer-to-peer trading consists of stablecoins, whereas this is not the case for platform trading. Bear markets heavily impact price-sensitive speculative assets, while stablecoins with payment utility remain largely unaffected.
Stablecoins serve as a value anchor during market volatility.
On-chain balance (the total dollar value of crypto assets in wallets and on the platform) fluctuates with market trends. Global on-chain balance declined from a peak of $860 billion in September 2025 to $440 billion by June 2026. Over this nine-month downturn, stablecoin holdings remained within a range of $9.8 billion to $10.9 billion. Since stablecoins are pegged to the U.S. dollar, their on-chain value does not fluctuate with crypto market movements; the total balance of other crypto assets fell by 55.6%. By June 2026, stablecoins accounted for 22.5% of global on-chain asset balances—not due to increased user purchases, but as a passive increase resulting from the depreciation of other assets.
This pattern is not new. From December 2022 to September 2025, stablecoin supply increased by 72.5%, then remained stable during the 2026 market downturn. In each bull-bear cycle, the baseline for stablecoin supply has been higher than the previous one; whenever the broader market declines, the proportion of stablecoins within total assets rises.
Global cryptocurrency balance and stablecoin balance percentage
Brazil has topped the global cryptocurrency adoption index.
Based on four indicators—platform fund inflows, wallet balances, domestic crypto economy, and cross-border capital flows—Brazil ranks first globally in the grassroots crypto adoption index. It did not rank first in any single category, but during the bear market cycle, it maintained strong performance relative to its economic size, outperforming mature markets such as the United States and Japan.
Base-level encryption covers the top 20 countries globally. Reporting period: July 1, 2025 – June 30, 2026
Statistical methods
The Base Index measures the adoption of cryptocurrency across countries worldwide, composed of four sub-indices representing different sectors of the crypto economy:
Platform fund inflows: Funds received by centralized exchanges, DeFi protocols, and other crypto services, weighted by each country's GDP per capita.
Domestic peer-to-peer transfer: Funds transferred directly between personal wallets within the same country.
Cross-border transfers: Fund movements across national borders, involving four pathways: person-to-person, person-to-platform, platform-to-person, and business-to-business.
Asset Balance: The total amount of holdings at a specific point in time, including assets in personally controlled wallets and balances on certain platforms (exchanges, non-KYC exchanges, and P2P exchanges).
The report ranks 117 countries with sufficient data. Raw values are first weighted by purchasing power parity, then normalized using min-max scaling to map uniformly onto the 0–1 range, with the lowest-ranked country assigned 0 and the highest-ranked assigned 1. A country’s overall index score is the geometric mean of its four normalized scores. This algorithm promotes balanced development across all four indicators, preventing outstanding performance in one area from masking weaknesses in others. For example, Brazil, ranked first, did not achieve the top score in any single category, but demonstrated consistently strong performance across all four indicators, resulting in its overall top ranking.
Method for Determining the Country of Transaction Attribution
Personal wallets are attributed based on behavioral characteristics, such as interaction records with exchanges in a single domestic country. Platform-level attribution is more challenging: exchanges consolidate all user funds into a single on-chain address, making it impossible to determine user nationality based solely on blockchain data. Platform funds are allocated to respective countries according to the share of website traffic from each nation; internal asset balances follow the same allocation logic. Traffic from high-income countries typically corresponds to transactions with larger individual amounts. Therefore, each country’s traffic share is reweighted and normalized by multiplying it by the square root of its per capita GDP. Using the square root of per capita GDP, rather than its raw value, moderately adjusts the weighting so that income influences allocation without fully dominating the outcome. The total global fund size remains unchanged; only the distribution among countries is adjusted.
For example: In June 2026, a leading exchange had equal traffic shares of 8.1% each from South Korea and India, with a total monthly inflow of $119.3 billion, resulting in initial allocations of $9.71 billion each. After adjustment, South Korea’s share increased to 11.6% ($13.87 billion), while India’s decreased to 3.2% ($3.78 billion), creating a 3.7-fold difference between the two—exactly equal to the square root of the ratio of their per capita GDPs ($36,239 for South Korea vs. $2,695 for India). The exchange’s total funds remained unchanged; only the allocation proportions between countries were adjusted.