ABSTRACT. The use of cryptocurrencies is rapidly expanding in emerging economies because of the prospects of having financial access and decentralized interactions, but it is affected also by a lot of legal and even social issues. The paper examines the forces that drive the crypto economy and governance of cryptocurrency in these economies under the context of economic turmoil, infrastructure and technological developments and buyer confidence. The study, which uses a mixed-methods design (a survey of 52 participants and a literature review), determines that some important motivators of adoption include the necessity of alternative systems in the management of money by the banking uninvolved and the power of social networks. It is in the findings that 71% of respondents find cryptocurrencies to be a secure alternative of the traditional banking system, and 79 percent would invest more under clearer regulatory provisions. But with regards to volatility what has been discussed in 71% of the respondents and convoluted taxation policies which have scared away 63% show obstacles of universal adoption. Regulatory action is mixed as certain markets introduce gradual regulation to promote confidence and some markets take stringent evidence which drives the business in underground. The research highlights the conflict that exists between innovation and attempting to minimize risks such as fraudulent acts and market volatility. Through the understanding of lessons drawn in various emerging markets, the research paper suggests the implementation strategies of balanced regulations that will boost consumer confidence and ensure sustainable integration of cryptocurrencies. It focuses on educating people, open policies, and technology to overcome difficulties in scalability and volatility. Their results can help clarify the potential of the emerging economies to use cryptocurrencies in their economic empowerment through the complicated regulatory matrix, a reference that can guide policymakers, entrepreneurs and their communities to take advantage of digital currencies.

Keywords: cryptocurrency; adoption; emerging markets; regulation; financial inclusion; volatility; blockchain

How to cite: Bonciu, C. I., and Stamule, S. (2023). “Cryptocurrency Adoption and Regulatory Responses: Lessons from Emerging Markets,” Smart Governance 2(1): 67–82. doi: 10.22381/sg2120235.

Received 10 January 2023 • Received in revised form 18 March 2023
Accepted 23 March 2023 • Available online 28 March 2023