Bitcoin's Increasing Role in Developing Countries: Image: Adobe stock
The developed world was the first to embrace and benefit from Bitcoin. And this was until recently, when there was a shift with developing countries leading in terms of Bitcoin growth. It is essential that developing countries realize the importance and potential of cryptocurrencies like Bitcoin and hence the trend. If you want to get started with Bitcoin mining, check the Bitcoin Buyer io
El Salvador made Bitcoin a legal tender, after which the Central African Republic (CAR) followed. All these are developing countries, and they are leading the way in terms of accepting and embracing Bitcoin. It’s surprising that while developed countries were the first to use Bitcoin, they are still lagging in taking it as legal tender. Developing countries are reaping the benefits of Bitcoin in various ways.
A major problem affecting most developing countries is poverty. Many people are poor and hence cannot fend for themselves. They end up depending on others or the government for survival. Bitcoin is helping in addressing the poverty problem in several ways.
To begin with, Bitcoin is increasing financial inclusion. More people accessing financial services can actively participate in economic activities like small businesses. And this provides them with some income to cater to their needs.
Additionally, through investing in Bitcoin, people in developing countries can reap big and even become millionaires. One way of investing is through Bitcoin trading.
Bitcoin is also contributing to economic growth in developing countries. As it opens up the financial sector to the participation of more people, the economy benefits when more people open small businesses and start other economic activities. Moreover, Bitcoin is boosting remittances from abroad. That’s because Bitcoin has removed the barriers that exist in traditional international money transfer systems, including high cost and time.
Increased financial inclusion tops the list of the impacts of Bitcoin in developing countries. For various reasons, many people and businesses in developing countries cannot access financial services, like opening bank accounts or accessing credit. Many people in developing countries can’t access financial services with high unemployment and illiteracy rates.
Bitcoin is addressing this problem because it has no requirements. Anyone can open a Bitcoin wallet and access financial services like loans and savings. With this, the many people the conventional financial system left out are now finding relief in Bitcoin. All one needs is internet access. Bitcoin is also available almost everywhere, including in remote areas.
Issues of corruption and low levels of social trust characterize many developing countries. Many government and public officials engage in corruption leading to funds and resources meant for development ending up in a few people’s pockets, leaving the people poorer. Bribery is common to access even the most basic services.
With Bitcoin’s blockchain technology, developing nations can eliminate such issues. When government uses Bitcoin to send funds to a particular office for a specific course, it is easy to track it on the blockchain. Therefore, Bitcoin is helping eliminate some of the historical problems like corruption and bribery and boosting social trust in developing countries.
As developing countries embrace Bitcoin more, they are beginning to realize its benefits and effects. Bitcoin is affecting not only individuals through, for example, financial inclusion and poverty eradication but also entire communities and countries through building social trust and economic development. It will be interesting to see the impacts in the next five years.
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