Focusing on the South Asian and Southeast Asian markets, an undeveloped crypto treasure land
South Asia and Southeast Asia are the third largest important markets, following the United States and Western Europe.Author: Ignas | DeFi Research
Compiled by: Deep Tide TechFlow
As cryptocurrency evolves into a global industry, the dominance of KOLs from the West and English-speaking countries may lead us to overlook opportunities outside the West.
For instance, in my previous blog post about the current market situation, I was surprised to find that OpenSocial has more users than Farcaster or Lens, despite having much lower visibility on the X platform. What is their secret to success? Indonesia, Vietnam, and India make up the majority of their user base.
Therefore, in this blog post, I have teamed up with Mai, the brain behind the official Pink Brains X account, to share insights about the South Asian crypto market.
We also interviewed several individuals from South Asian countries to understand their personal experiences.
South Asia - The Wilderness of Cryptocurrency
Token2049 in Singapore is undoubtedly the largest cryptocurrency event of 2024, and one point that impressed us came from Andy's sharing: "The Asian market is still underdeveloped."
While East Asia—such as South Korea, Hong Kong, Taiwan, China, and Japan—has become a major cryptocurrency hub with clear regulatory policies, large institutions, and professional investors involved, Central and Southern Asia and Oceania (CSAO) have taken a different, often overlooked approach to cryptocurrency, which is not commonly seen on Western crypto Twitter.
Here is the 2024 Chainalysis Global Cryptocurrency Adoption Index map.
According to Chainalysis data, the Central and Southern Asia and Oceania (CSAO) region is the third-largest cryptocurrency market, with over $750 billion in cryptocurrency inflows from July 2023 to June 2024. This accounts for 16.6% of the global total. Let that number sink in. Only North America and Western Europe have higher figures.
In the 2024 Global Cryptocurrency Adoption Index, the Central and Southern Asia (CSAO) region indeed stands out, with seven countries making it into the top 20: India (1), Indonesia (3), Vietnam (5), the Philippines (8), Pakistan (9), Thailand (16), and Cambodia (17).
How Do South Asians Adopt Cryptocurrency?
Vietnam
First, let's take a look at Vietnam, where most members of our DeFi creator studio Pink Brains come from, providing personal experiences for the market. According to Triple-A data, Vietnam has the second-highest cryptocurrency ownership rate in the world. Approximately 21.2% of the population holds cryptocurrency, second only to the UAE's 34.4%.
According to Chainalysis data, Vietnam also made substantial profits last year, ranking third globally, with realized cryptocurrency gains reaching $1.18 billion. This is double the gains of Spain and the Philippines and three times that of Thailand.
One reason for this is the Vietnamese government's ambiguous stance on cryptocurrency. While cryptocurrency is not banned, its practical use, such as for payments or collateral, is not permitted. This makes holding cryptocurrency attractive, even though the actual adoption rate still lags behind other Southeast Asian countries.
For most Vietnamese crypto investors, centralized exchanges (CEXs) are the preferred choice. Binance, Bybit, OKX, and BingX are the most popular exchanges, while Coinbase has a small market share due to language barriers and complicated KYC processes. Trading and holding cryptocurrency on CEXs remains the most common investment strategy.
Airdrop farming and crypto mining are very popular here. You will see a plethora of Telegram and Facebook groups sharing tips, "hidden treasure" alerts, and token giveaways. In fact, buying clone accounts, faking KYC, or setting up bots is very easy and cheap, with almost no hassle. This has made Sybil attacks from Vietnamese farmers a significant challenge for protocols. Some of the large airdrops you might hear about include Arbitrum, LayerZero, Aptos, and zkSync.
Most investors in Vietnam are not experienced traders. They primarily seek quick profits, viewing cryptocurrency as a side hustle or a life-changing opportunity outside their main jobs. Seasoned investors typically look for low market cap tokens on decentralized exchanges (DEXs) while holding significant assets on centralized exchanges (CEXs). Meanwhile, new investors since 2022 often chase airdrops and reward incentives. Experienced traders usually incur losses during major black swan events (like FTX or Luna), while newcomers often suffer losses due to incorrect KOL signals, scams, or excessive leverage.
Vietnam is a top country in international math competitions and a hub for blockchain development talent. You may have heard of well-known figures like Loi Luu (Kyber Network) and Vu Nguyen (Pendle), but there are also some notorious serial scammers, like the person behind Whale Markets!
Note: My team has a strong aversion to this person. Please check the discussion above to understand how he has harmed investors' interests. Mai also told me that retail banking and cashless payments are rapidly developing in Vietnam. Vietnam is moving along a path similar to China, where digital wallets, banking apps, and credit cards are gradually replacing cash, especially in large cities. This change is good news for Web3, creating conditions for the widespread adoption of crypto payments, similar to the current situation in Singapore. More and more large companies are beginning to integrate blockchain technology into their businesses.
We have already seen some preliminary tests in the banking sector, such as HSBC Vietnam conducting the first real-time blockchain experiment for L/C payments. These attempts indicate that Vietnamese businesses are very interested in blockchain technology.
But we still need to wait for the legal framework to further open up to cryptocurrency.
India
Despite the constantly changing regulations and taxes in India, the country remains a major player in the global crypto market. India imposes taxes of up to 30% on crypto gains and a 1% tax on all transactions, leading some investors to seek less restricted international exchanges. Despite these hurdles, cryptocurrency continues to grow rapidly in India. The rise of innovative crypto startups in India indicates a need for more favorable tax policies and clearer regulations to maintain this momentum.
I asked Hitesh.eth on X what makes India unique. Besides his unique insights into cryptocurrency, Hitesh is also developing a platform (DYOR) to help people understand crypto basics more easily. India has the largest unemployed youth population, eager to work hard for incentives. If done right, the app can guide these incentives through tokens and points, similar to what was seen in Axie in the past. In terms of infrastructure, India has some of the best developer resources, with costs far lower than in the EU and the US.
He said, "Over 50% of community-related positions are held by Indians, and even more are eager to join this field." However, this temporary work in cryptocurrency and high aspirations "have led to some issues, as past airdrops have created a false impression of Indians. However, this view should not be generalized, as it is more case-specific rather than universally representative."
Indonesia is one of the fastest-growing markets in terms of trading volume.
According to a product manager at the Indonesian cryptocurrency exchange Pintu, the growth of crypto activity is mainly driven by speculation. "Many people still see crypto as a way to make quick profits," he said. "Now, many traders turn to Telegram groups for signals, just like they used to do for stock trading, but with new tokens constantly emerging, activity in the crypto space is even more intense." He also mentioned that stricter rules from the Indonesian stock exchange might be pushing people toward cryptocurrency. "As new comprehensive auction measures make stock trading stricter, some investors are looking for alternatives like cryptocurrency."
Compared to regional and global averages, Indonesia stands out in decentralized exchanges (DEX) and decentralized finance (DeFi) activity.
This is confirmed by Eli5DeFi on X, who stated, "Many Indonesians participate in cryptocurrency trading, often starting with meme coins or airdrops because they are simpler and more appealing. Especially airdrops, which usually only require time and effort to participate."
He added, "We mainly use the TON app recently, and some people even build their own communities to mine and farm $DOGS, $NOT, and $HAMSTER."
As Indonesians become more crypto-savvy, yield farming, staking, and decentralized finance (DeFi) projects are becoming increasingly popular. This growth has formed a new community of "crypto enthusiasts," with over half of the investors being millennials and Gen Z, seeking emerging technologies and quick profits.
DeFi is also on the rise, with many DeFi builders from Indonesia - Eli5DeFi
Here are some notable examples:
@0x_eunice - Co-founder of Monad
@Mariobern - Co-founder of Pyth
@bradydonut - Co-founder of HawkFi
@BrianLimiardi - Co-founder of Copra
@smsunarto - Founder of Argus Labs
@bizyugo - No. 1, Debank
@mathdroid - Pandora
@PatriaAbditiar - Sociocat
Singapore
While countries like Indonesia and Vietnam see cryptocurrency adoption driven by "crypto degeneracy" and the promise of quick profits, the situation in Singapore is different.
Ronald Chan from Saprolings (Web3 Incubator) told me that after China shut down crypto companies, the number of crypto firms in Singapore surged. Here are the reasons they choose Singapore:
Geographic proximity to China
Deep Chinese cultural roots
Relaxed political environment
Low tax rates
A large Chinese-speaking community
Free flow of capital (including Bitcoin)
Strong legal system (which is very important)
Well-educated personnel to run businesses
A strong financial center in the region
Almost no other options in the region
"We protect ourselves by being the leading bank for our neighbors." - Ronald Chan
Secondly, regulatory progress and merchant services show greater potential for cryptocurrency beyond just trading and investing. Ronald pointed out that Singapore "issues banking licenses to local and foreign banks for fair competition, which is different from many other countries."
Additionally, Singapore "has a nationwide QR code scanning system similar to China's WeChat Pay and Alipay (called Paynow QR), which most people use. Mastercard and Visa are widely available, but users and merchants are not satisfied because both sides have to pay extra fees."
More importantly, the super app Grab, which many people use for ride-hailing, food delivery, and other services, has started allowing users to top up their e-wallets using cryptocurrency. Now, users can pay with Bitcoin, Ethereum, XSGD (Singapore's local stablecoin), Circle USD, and Tether.
In Q2 2024, cryptocurrency payments for merchant services in Singapore reached nearly $1 billion, marking the highest level in two years.
This is an interesting shift, especially in a market where traditional payment systems are already efficient, indicating that cryptocurrency is gradually becoming a common asset for more people.
Meanwhile, over 75% of XSGD transfer amounts are $1 million or less, with nearly 25% of transfers being below $10,000, clearly indicating that the retail user base in the local crypto market is growing.
The reason for this success is clear regulation, which enhances trust in stablecoins.
In 2023, the Monetary Authority of Singapore (MAS) established guidelines for stablecoins, and in 2024, it introduced rules for cryptocurrency custody and licensing.
This demonstrates the positive impact of clear regulation on cryptocurrency adoption in the US.
Case Study: TON's Successful Entry into the South Asian Market
TON's click-to-earn game is surprisingly popular in South Asia. Personally, I have tried it, but the rewards I received were not worth it for me.
You might underestimate TON due to the over-distributed airdrops and "mindless" click-to-earn games, but it actually aligns with their goal of bringing cryptocurrency into everyone's pocket.
By obtaining free tokens, a new wave of users can start learning how to trade on decentralized exchanges (DEXs), add liquidity, stake, and gradually explore other aspects of the ecosystem.
Do you know where these users mainly come from? The CIS countries and South Asia.
Notcoin's website (notco.in) receives over 66% of its traffic from CIS countries. Following that are Asian countries like Indonesia, Vietnam, China, and India. Getgems.io and Hamster Kombat show similar trends, consistent with the Telegram user base.
The Telegram Mini Bot project offering free tokens is similar to the rise of Axie Infinity in the Philippines.
The success of the TON blockchain can be attributed to two high-adoption areas: free airdrops and click-to-earn games.
Free Airdrop Space
Everyone is tired of activities that exchange points for airdrops. This is what makes the free airdrop scene on Telegram unique. It leverages Telegram's 900 million users to distribute tokens like DOGS. DOGS initially gained attention as a meme due to its fair distribution and lack of presale. This attracted new users to the blockchain, making DOGS different from typical crypto tokens.
DOGS quickly listed on major centralized exchanges (CEXs) like Binance. Airdrop amounts ranged from $10 to $60 per wallet. While this may not sound like much to many Western investors, users can farm through multiple accounts. For many people in developing countries, these airdrops provide a new source of income amid economic difficulties.
Click-to-Earn Games
Click-to-earn games like Hamster Kombat are rapidly growing in South Asian countries. Within just three months, it reached 239 million registrations, making it one of the most popular click-to-earn games.
It also gained over 10 million YouTube subscribers in just one week. That's insane. These are unprecedented numbers in many Western countries.
According to Bitget Premarket data, its token has a total market cap of $920 million, suggesting that the value of the airdrop could be around $550 million.
Due to simple game mechanics, referral activities, and strong social influence, click-to-earn games like Hamster Kombat have quickly attracted significant attention among cryptocurrency influencers in Southeast Asia.
These influencers are also very popular on TikTok and X, sharing referral links and spreading information about this type of game.
Conclusion
South Asia and Southeast Asia are among the most populous regions in the world, with a young and tech-savvy population, making them key markets for cryptocurrency businesses. It is now the third most important market, following the US and Western Europe.
However, due to significant differences in income, government regulations, and economic conditions among the countries in the region, it is challenging for businesses to formulate corresponding strategies for each country.
TON seems to be doing well with its strategy targeting the speculative market, and the acceptance of crypto payments is continuously rising.
