Despite the constant headlines in crypto media about “regulation-by-enforcement” and US politicians trashing the digital asset industry, North America remains the largest cryptocurrency market in the world.

North America had 24.4% of all the value received on-chain between July 2022 and June 2023, which represented about $1.2 trillion of the global crypto transactions, according to a Chainalysis report.

And most of that activity — over $1 trillion of it — originated in the United States.

That’s the same nation whose securities regulator sued Binance and Coinbase in June. Authorities in the US — specifically attorneys in the Southern District of New York — are also prosecuting FTX’s Sam Bankman-Fried and ex-Celsius CEO Alex Mashinsky for alleged fraud on their customers.

These developments, specifically the blowup of FTX, didn’t catalyze some great migration over to DeFi. In fact, North America’s usage of DeFi protocols slumped considerably since August 2022 and has stayed relatively flat since November 2022.

Chainalysis chalked this up to regulatory uncertainty in the realm of DeFi products. A recent example of this came in early September when the US Commodity Futures Trading Commission charged Opyn, ZeroEx and Deridex with allegedly operating unregistered trading platforms.

Still, Chainalysis claimed that FTX going bust and the banking failures of March 2023 — including Silicon Valley Bank, Silvergate and Signature — didn’t have much of an impact on retail users’ overall crypto trading activity.

Institutions, however, pulled back after the FTX collapse and the March banking crisis, which Chainalysis said was the “primary driver in the overall decline in activity” in 2022 and 2023. However, June 2023 appeared to be when institutions got back in and drove on-chain activity back up.

“North America’s crypto market is more driven by institutional activity than any other region’s with a whopping 76.9% of transaction volume driven by transfers of $1 million or more,” Chainalysis wrote.

With the fervor surrounding the race for a spot bitcoin ETF still going strong, institutions could further cement North America and specifically the US as the center of crypto participation. This could take a while though, as the US Securities and Exchange Commission has continually delayed applications from BlackRock and Valkyrie as well as 21Shares and Ark Invest.

Assets like bitcoin (BTC), ether (ETH) and others still take second place to stablecoins, which remain “the most widely-used type of crypto asset.”

That’s perhaps why Congress is most keen on regulating tokens pegged to fiat currency such as the US dollar.

The Clarity for Payment Stablecoins Act was introduced by House Financial Services Committee chair Patrick McHenry in July 2023 and has had the most progress so far.

The latest is that the bill advanced to a floor vote in the House of Representatives, though the actual vote hasn’t been scheduled yet.

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