Cryptocurrencies truly revolutionized the world in so many different ways it is hard to think of them all. Apart from providing us with an alternative asset that has more benefits than the tired-old FIAT money we use every day, crypto also has other benefits that most people don’t see.
We are talking about big opportunities that are handed out to emerging markets. Markets where the government didn’t care about global expansion or they don’t have enough money to worry about such problems.
People here were stuck, at least digitally. Starting an online business is difficult, buying things online is a nightmare, and there are limited banking options, which eventually limit your worldwide potential and many other things.
It seems like cryptocurrencies changed that. Or at least it feels that way. After all, we are talking about an alternative asset class that doesn’t know about borders.
We are talking about a network where any US citizen is as good as a person from Nigeria or other less-developed countries.
In crypto, no questions are asked. We’ve been dreaming about global currency for many years, but unfortunately, that isn’t possible due to government conflicts, and politics. But all of sudden, there is a digital asset set doing the same, with an unknown inventor, and enters the scene quite shockingly.
Now all of a sudden, emerging markets have many different options for payments, they are much more open to the global market, and their economy is booming.
Why Are Emerging Markets Embracing Cryptocurrency?
Cryptocurrency is an asset class with a decentralized nature. This means that there is no need for a central authority like a bank, and people can transact directly with each other, often using nothing by their smartphones and a few clicks.
So, I think it is quite easy to see why emerging markets are embracing cryptocurrencies. First, we have a rise in value that can significantly boost their economy, and based on many predictions on the Bitcoin and other cryptocurrency prices, it is going to rise a lot more in the future.
This means that emerging markets can multiply their investments in just a few years’ time. But that’s not the biggest reason why people in emerging markets are using cryptocurrencies.
We also have other problems like the government, which controls the money supply, and basically is in charge of inflation.
Some governments have done a poor job resulting in people losing the value of their hard-earned money, which is why many are transitioning to cryptocurrencies.
Lastly, we have a lack of banking options for less developed countries, and people have no choice but to go with cryptocurrencies in the form of payments since here there are no limitations. They even use crypto since they cannot engage with things like sports betting due to banking limitations. So, they go for crypto sports betting websites like evo.io.
The Mobile Connection
One of the biggest game-changers is the widespread use of mobile phones. Even in places with little infrastructure, smartphones are practically everywhere.
In Nigeria, for instance, the adoption of cryptocurrencies has soared, driven by high inflation and limitations on foreign exchange access. People have started using cryptocurrencies as a hedge against inflation and for cross-border transactions, bypassing the complex and often restrictive traditional banking system.
The integration of cryptocurrency wallets into mobile apps is a massive enabler. Imagine having your bank, remittance service, and investment portfolio all in your pocket—except it’s crypto, and it’s way cheaper and more accessible than what banks typically offer. This is especially useful for sending money across borders, a common need in many emerging economies where remittances are a lifeline for families.
What Problems Does Crypto Solve?
You might be thinking, “Okay, crypto sounds cool, but what specific problems does it solve in these markets?” Here’s a quick breakdown:
- Lack of Access to Banking: Over 1.4 billion adults worldwide don’t have access to traditional financial services, and a significant portion of them live in emerging economies. With crypto, all you need is a smartphone and an internet connection to get started.
- High Remittance Fees: In 2022, the average cost of sending a $200 remittance was about 6.3%, according to the World Bank. With cryptocurrencies, those fees can drop to almost nothing. Platforms like Bitcoin or stablecoins allow people to send money quickly and cheaply across borders.
- Currency Instability: Many emerging markets face currency volatility and inflation, eroding the value of people’s savings. Cryptocurrencies like Bitcoin or stablecoins can act as a store of value, preserving wealth in times of crisis.
Success Stories: Where Is Crypto Already Working?
Nigeria
In Nigeria, economic instability has made cryptocurrency a popular alternative to traditional banking. Inflation rates have soared, and access to foreign exchange is limited, making it hard for people to preserve wealth.
But with cryptocurrencies, Nigerians are finding new ways to store value and transact across borders—often in defiance of government regulations. It’s not just a tech fad; it’s a real-world solution to real problems.
Kenya
Kenya is another hotspot where crypto adoption is thriving, largely thanks to the mobile banking revolution led by M-Pesa. As more Kenyans embrace digital wallets, cryptocurrencies are starting to find their place in the ecosystem, offering faster and cheaper cross-border payments and an alternative to the sometimes unreliable local banking system.
