The popularity of cryptocurrency is consistently increasing, and this has been amplified by the COVID-19 pandemic, with more people looking into investing in alternative currency. This rediscovery of cryptocurrency has seen more people realising its value and making it more usable overall, with Bitcoin at the centre.
Cryptocurrency has become a big part of many of the more significant economic powers of the world, with the US and the UK high up in the total number of cryptocurrency traders in their respective countries.
While several developing countries have been introduced to and trade in the cryptocurrency market, it is not at the level, it should be to become usable within their borders. Cryptocurrency needs an increase in trading volume to increase its value.
This would bring the apparent necessity to become more viable on a global level. However, this will not happen without the developing countries and understanding the difference in strategy when approaching this market. Several factors play into attempting to reach this market, and in dissecting these factors, we will see how cryptocurrency can improve developing countries.
The limitation of technology in Developing Countries
First and foremost, cryptocurrency is proof of how technology has advanced in the world. However, not everyone in the world has access to the same technology. It is a characteristic for most developing countries to have a significant disparity in available technology between the heavily urbanised areas and the more rural areas. Internet access, for example, is not always easily accessible to everyone. For several developing countries, online transactions and PayWave have only recently become available and popular. The progression of technology may not be there yet for cryptocurrency to be usable in some, if not most developing countries.
View on Finance, Investing, and Cryptocurrency in Developing Countries
In developing countries, there is a large difference between social classes. While the middle class is large, there is a vast difference between the lower and upper classes. Within the middle class itself, there is a disparity between the upper-middle and lower-middle classes. Why is this important?
The different classes all value money very differently, and many of the lower-middle to lower class people, have no opportunity to make investments. Money only is a tool for survival and comfort. Investing is something only those with excess amounts of money can do. This would limit the reachable market of cryptocurrency compared to more developed countries where people are more open to investing.
How Cryptocurrency can help Developing Countries
Having done several studies and research analyses, economists believe that the introduction of cryptocurrencies can increase development within a community. Introduced on a larger scale, it can have a similar effect on whole developing countries. Firstly, the growth of cryptocurrency should grow with the availability of stable internet access. With the increased usage of the internet, there is a broader exchange of ideas and technology between developing and developed countries, including cryptocurrency. For several developing countries, digital currencies come with hefty fees and taxes.
Cryptocurrency works on minimal fees, making the exchange of digital currency much cheaper. This would improve small scaled trade between developing and developed countries. Creating a quicker, more affordable way of life that is closer to more developed countries. Changing the perspective on investing is also a more cultural change that cryptocurrency can affect. Seeing the value of investing and the practical usability of the fruit of their investments will increase the potential income of the overall population.
It is not a secret that several risks come with buying cryptocurrency. However, the more people take these risks, the less the risk becomes. Going global is vital in the growth and practical usability of cryptocurrency. Reaching the developing countries is essential in this growth. However, the change is not one-sided, and if done correctly, it could be a win-win situation for everyone.
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