Crypto For Developing Countries
Cryptocurrencies can advance developing countries.
Hyperinflation, poverty and unemployment are the major difficulties faced by developing countries and these have become barriers to prosperity. At the root of the problem are the lack of banking services and capital.
The World Bank estimates that over two billion people around the world are omitted from the financial system due to poverty and disconnection from global commerce. The unbanked, as they are called, do not enjoy the services of commercial banks. This is where cryptocurrencies step in to bridge the gap.
The biggest advantages that cryptocurrencies offer are the increased accessibility to transfer money and increased transparency which are sorely missing in many countries.
The Secret Weapon
Transparency in cryptocurrency minimizes the risk of data loss through its tracking features and the data encryption on the blockchain. Token transactions are thus tamper-proof and more secure.
The accessible nature of cryptocurrencies allows users to easily complete transactions over your mobile device. As the majority of the world’s population owns a mobile phone, cryptocurrencies are accessible to almost everyone, including those unbanked. It is now safer and easier to maintain a cryptocurrency wallet than it is to deal with the high transaction fees from banks and various financial institutions.
By leveraging the security and accessibility of blockchain on mobile phones, blockchain-powered mobile applications might just be the missing key for developing countries!
Blockchain-Powered Super Apps
Due to the geographical environment and development of their nations, the availability of banks or any other financial institutions for the unbanked is scarce. However, living in remote areas does not exempt them from requiring access to capital for their livelihoods. Banking services are still important for them to finance their properties, deposit money and account for their business transactions. As mobile phones are widely used even in developing countries, cryptocurrencies can be easily accessed and they can now benefit from banking services in terms of cryptocurrency. The use of tokens thus pulls the unbanked back into the financial system so that they may enjoy more opportunities to improve their financial health.
- Distributing loans
With cryptocurrency platforms, the unbanked now have the opportunity to apply for loans for various purposes like mortgages or business operations. Loans that facilitate business growth can help to boost the economy’s exports.
- Empowering women
According to The World Bank, around 55% of the unbanked are women. The existence of cryptocurrency banking apps will improve and empower women around the world by including them into the financial system.
- Facilitating business transactions
Entrepreneurs that sell globally bring in higher profits for their nations’ economies. However, global trade relies on the frequent exchange of foreign currencies. The exchange fees paid to intermediary banks presents a growing cost for business owners. Using tokens minimises the fees incurred from business transactions like process payments, supplies and equipment expenses and approved loans and lines of credit.
Cryptocurrencies and blockchain are promising alternatives to traditional banking. These can boost the economy of developing nations by enabling the unbanked to participate more actively in the workforce. Cryptocurrencies assist developing nations through the promotion of transparency, emphasis on security, lowering of transaction costs, as well as the inclusion for the unbanked in the financial system.
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