Bitcoin Potential in Developing Countries
Bitcoin trading volume is surging in Africa. Latin America uses it to outwit fiat inflation. BTCMEX explores crypto opportunities that are enhancing the finance of developing countries.
Crypto adoption is growing rapidly worldwide, especially in developing countries. Cryptocurrency ownership, trading volume, and regulations all moving towards the greater adoption in Africa, beating Latin America in crypto usage recently.
Cryptocurrencies are still more popular in developed countries than in the developing world due to the lack of information and financial exclusion of citizens of some parts of Asia, Africa, and Latin America, who have a lack of access to modern technologies and financial education. Therefore, making crypto wallets easily accessible to this group of consumers could be a big step toward using cryptocurrencies to offer financial services through digital accounts to the unbanked and underbanked.
Diversity and inclusion are recent trends promoted along with the rising interest in crypto usage adoption. Many regions of Asia, Latin America, and Africa suffer from poverty, inflation, and corruption. Blockchain technology can meet the existing needs of protecting user privacy, and sharing the economic value in these regions. Being able to transfer currency in this way also provides tremendous growth potential for small businesses in developing countries. With the decentralized nature of cryptocurrency allowing many of them for the first time to truly operate on a global scale, thereby fighting the corruption.
Despite being highly volatile assets, cryptocurrencies proved to be a novel tool to fight hyperinflation. Bitcoin adoption in Venezuela and Zimbabwe has skyrocketed last year, as many people started looking for investment alternatives and diversification.
According to the latest studies conducted by Statista, dated March 2020, the top 5 countries to drive crypto adoption are Turkey (20%), Brazil (18%), Colombia (18%), Argentina (16%), and South Africa (16%). According to the “Top 10 Bitcoin Cities” by Forbes, Latin America’s capitals Buenos Aires (Argentina) and Bogota (Colombia) occupy 2d and 7th places respectively. According to the Statista Global Consumer Survey published in 2019, in which an online poll was conducted among 1,000 people for each country studied, showed that Latin America is the region with the highest number of crypto users in the world.
Today, cryptocurrency usage spikes in Africa, which reported $14.6 million in weekly peer-to-peer Bitcoin trading volume, with Latin America, Asia Pacific, and Western Europe posting significant declines after the halving. According to the latest Arcane Research report, Africa currently shows the highest rates of cryptocurrency adoption in the world, with Uganda, Nigeria, South Africa, Kenya, and Ghana feature in the top 10 countries searching for the term “cryptocurrency” on Google.
Various tools, like Lightning Network, exchanges, and education platforms have increased Bitcoin’s functionality and accessibility around the world. Experts point out the main challenges that Bitcoin faces in developing countries, such as transaction speed and scalability. Transaction fees on the Bitcoin blockchain are high and they are rising. Along with mass adoption.
Historically, third-world countries have suffered because their currencies are so susceptible to market changes and that causes rampant inflation. Bitcoin operates on a global platform it is only susceptible to global economic changes, and localized changes will have little to no impact on the currency’s overall value, solving the problem of hyperinflation. With the paradigm of decentralization, cryptocurrencies offer an alternative to central bank policies disastrous for the developing countries.