Since the 2009 inception of Bitcoin, the cryptocurrency space has come an incredibly long way come on being valued at over $1 trillion collectively. The outlook on the currency has been very positive in some territories such as Vietnam and Singapore, with others such as the United States not necessarily having the same kind of welcome perspective.
With that being said, several emerging markets are taking advantage of crypto’s potential, with the benefits expected to look like the areas covered below.
A Shoo-in for Lackluster Traditional Alternatives
What you'll realize in a lot of emerging markets is that the presence of crypto presents a viable alternative to traditional media of exchange that may come with one problem or the next. In Africa, for example, you'll find that there are many people without banking services. Similarly, if you turn your attention to a territory such as Vietnam, you'll notice a situation where remittance services, for example, are sorely lacking, creating the perfect storm for cryptocurrency to fill the gap.
Another noticeable trend is using trading bots like Bitcoin Pro, that help to make day trading even more profitable.
There are also the benefits of addressing issues with traceability, ownership, etc. Since the existing banking systems and Fiat currencies have been unable to fill these needs in these territories, one of the roles of the crypto space is to provide a solid medium of exchange that allows for holdings independent of banks, alongside reliable transfer services.
Problem Solving
The transactional capabilities of cryptocurrencies are vast. However, it doesn't stop there as the advent of blockchain 2.0 created an industry in which the technology can be used for different applications. Looking back at Africa, web3 presents a viable digital identity solution. The lack of legal identities in Africa is a challenge. Creating verifiable digital identities is one potential solution.
India is another prime example of a place where web3 has great potential. The country is famous for its overwhelming technological talent pool. Additionally, the adoption rate for technology is pretty high.
One of the immediate challenges is that of intellectual property rights stemming from the slew of innovative creations. Suddenly, the blockchain presents a solid option for creators to store and manage their work, allowing for better control of distribution and management of ownership.
Development of the Emerging Markets
Crypto and blockchain technologies are meant to provide availability and value for different regions that may be lacking in various areas of development. Sure, no one blockchain technology will be able to solve all the problems that various emerging markets will have, but some attributes are very valuable including financial inclusion, sustainability, and interoperability. Cardano, while not the most popular market entrant, is known for its highly efficient proof of stake consumption mechanism. With its lower energy use, it improves the affordability and accessibility factor for those residing in developing countries.
Additionally, these emerging markets can benefit from greater understanding, which fits right into Cardano’s focus on training and education. Greater skill means greater potential to capitalize on the offerings of blockchain technology.
Consider the collaboration with Pezesha too that is looking to provide Africa with a P2P financial system. Cardano, in this sense, is fulfilling its role to improve development and economic access. Suddenly, people can borrow and lend with proper regulations. Economic growth and financial access are two challenges that Africa has traditionally struggled with, and Cardano is working to help address these kinds of situations.
Protection from Economic Challenges
This doesn't mean that the presence of cryptocurrency will immediately offer shelter from all the economic challenges that emerging markets may face. However, there's a lot to be said for its benefits such as a being hedge against inflation. This was one of the reasons why Bitcoin launched the way it did with a finite limit and fewer new coins entering the rotation every four years. It's the same principle of a finite amount leads to gold being able to maintain its value regardless of what happens with Fiat currencies.
Wrapping Up
Emerging markets stand to benefit greatly from cryptocurrencies and blockchain technologies across finance and other applications. The information above sheds some light on some of the more fundamental elements.
For active traders and investors, mastering the art of trading volatility is a crucial skill. Volatility, in financial terms, refers to the extent to which asset prices fluctuate over time. High volatility markets experience rapid price swings...
The global financial market operates as a dynamic ecosystem, where understanding the connections between different market movements can provide invaluable insights for forecasting...
The forex market, also known as the foreign exchange market, stands as the largest and most traded financial market globally. FXTM is committed to equipping our clients...
Cryptocurrency trading has rapidly grown into a bustling and dynamic market that attracts traders from around the world. With the potential for significant profits...
The year 2023 has been a landmark period for the international broker Octa (formerly known as OctaFX), characterized by significant achievements and substantial contributions...