The collapse of Sam Bankman-Fried’s FTX triggered at least $20.7 billion in withdrawals from centralized cryptocurrency exchanges. Seeking to reassure users, the remaining cryptocurrency exchanges announced efforts to increase disclosures on their financial positions. This pushed the concept of Proof of Reserves (PoR) into the spotlight among the crypto community, such that global search interest in PoR spiked in the week of November 6 by 270% week-on-week, then peaked the following week.
Singapore, Nigeria, Hong Kong, Austria and Netherlands most interested in Proof of Reserves, with a combined 60% share in search interest.
The majority of global search interest in PoR-related terms this year came from Singapore (20.5%), Nigeria (14.1%), Hong Kong (11.4%), Austria (7.8%) and the Netherlands (7.0%), which held a combined 60.8% share as of December 6.
Cryptocurrency hub Singapore topped the rankings as the country most interested in PoR. The city-state scored the highest of 100 for ‘proof of reserves’, ‘merkle tree’ and ‘merkle root’, resulting in a total score of 300 to place first among the top 25 countries interested in PoR.
Nigeria ranked second for search interest in PoR with a total score of 206, after scoring the maximum of 100 for ‘proof of reserve’, as well as receiving relatively high points of 49 for ‘merkle root’, 35 for ‘merkle tree’ and 22 for ‘proof of reserves’. An earlier study had found that Nigeria was the most curious about cryptocurrency among English-speaking countries.
Hong Kong came in third for PoR search interest with a total score of 167, by scoring the second highest for ‘proof of reserve’ at 92 points, as well as the third highest for the remaining terms of ‘merkle root’, ‘merkle tree’ and ‘proof of reserves’ at 37, 21 and 17 points respectively.
Austria took fourth place with a 115 total score, followed closely by the Netherlands with a 102 total score. Both European countries saw relatively strong search interest in ‘proof of reserve’, and moderate interest in ‘merkle tree’ and ‘proof of reserves’, but had insufficient search interest data for ‘merkle root’.
Singapore among top 3 countries most impacted by FTX collapse
Singapore’s high search interest corresponds with the rankings of countries most impacted by FTX’s collapse. Based on web traffic data to FTX.com, Singapore was the second most impacted country by the FTX collapse, with 241,675 monthly average unique users representing 5% of traffic to the international website. In addition, Singapore’s sovereign wealth fund Temasek Holdings wrote down its $275 million FTX investment to $0, sparking national controversy and partly explaining the popularity of PoR-related search terms among Singapore netizens.
Although South Korea emerged as the country hardest hit by FTX.com’s demise, it ranked low for PoR search interest at the 21st position with a total score of 9. This might be attributed to the Republic of Korea’s top search engine being Naver instead of Google, and its native language being Korean.
Similarly, Japan was the third most impacted but did not make the PoR search interest rankings, likely because any searches for PoR-related terms from the country were in Japanese.
Methodology
The study examined relative search popularity by locations, for four English terms related to the concept of Proof of Reserves – ‘proof of reserves’, ‘proof of reserve’, ‘proof of liability’ and ‘merkle tree’ – based on Google Trends data. Terms were selected from the study on PoR search interest over time.
The location setting was ‘Worldwide’ and the time range was set from January 1 to December 6. The two remaining parameters were left to the default options of ‘All categories’ and ‘Web Search’.
The numbers represent relative search popularity compared across locations, for a selected term and time. A value of 100 indicates maximum popularity as a proportion of total searches and a value of 50 indicates half the popularity, while a score of 0 means there was insufficient search interest data. The locations were then ranked by their ‘Total Search Score’, which was obtained by adding up the search interest for the four terms.
The study notes that the most widely used search engines for all locations may not be Google.
All dates stated are in 2022.
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Looking for more information on what happened with FTX? Check out this study we did on How Many Crypto Whales have BTC or ETH On-Chain?
Yuqian is a crypto research analyst at CoinGecko, covering a range of topics from NFTs to ETFs, crypto adoption and interest, and beyond. She's especially fascinated by the philosophical and socioeconomic aspects of crypto. She holds a Bachelor of Social Sciences with Honors from the National University of Singapore. Follow the author on Twitter @solosbrqt
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