Emerging markets are among the leading adopters of blockchain-based solutions. Digital applications can help solve many of the problems in emerging markets that are not as pressing in developed economies.
While developed western nations were the primary adopters of new technologies over the past 100 years, they have been somewhat slow in adopting digital technologies. On the contrary, the digital wave is moving fast in some of the world’s emerging markets.
The reason behind that is not hesitation or rejection of technological innovation in the west, but rather the fact that the value proposition of digital solutions is more visible and more attractive in emerging markets.
Demographics and market size more attractive for digital startups
Emerging markets typically have younger populations and high mobile penetration rates. Almost 90% of the world’s population under the age of 30 live in emerging and developing economies, especially in Africa and the Middle East. They are tech-savvy, have access to low-cost mobile devices and the internet and are also getting increasingly wealthy.
Thailand, for example, has one of the highest internet penetration rates in the world. According to Internet World Statistics, there are 57 million internet users in Thailand, out of a total population of 69 million. In 2017, there were about 660 million smartphone users in China, compared with only 220 million in the US. Hence, the size and accessibility of the market make it attractive for businesses that develop technological applications.
Emerging markets are leaders in cryptocurrency adoption
The use of digital currencies is one area where this trend has become visible. Currently, South Africa is the worldwide leader in crypto adoption. A study found that 10.7 percent of internet users in South Africa own cryptos, with Thailand and Indonesia following at 9.7 percent and 9.3 percent respectively. The global average currently stands at 5.5 percent.
It’s not surprising that cryptocurrencies are more popular in emerging markets than in developing countries. It’s not that users are more open to digital currencies, but their value proposition is relatively more attractive.
Firstly, there is a lack of alternative investment opportunities. Eugene Madondo, the digital marketing strategist at Coindirect, explains most users in South Africa view Bitcoin as a speculative asset, rather than a currency. Investors are leveraging crypto volatility to increase trading profits.
Secondly, there is lower trust in government authorities. Corruption and legal uncertainty are a problem. Therefore, the idea of a decentralized, anonymous currency is appealing to users for multiple reasons: to protect themselves from government intervention, but, on a more negative note, also to hide funds gained from criminal activities.
Thirdly, local currencies are less stable and reliable. That also explains the increasing interest in stablecoins.
Just recently, Coindirect has raised €1m in an investment round led by Concentric, with participation from Blockchain.com, and MakerDAO, to enable customers in emerging markets to trade cryptocurrencies using their local currency. Another example is BitPesa, a digital foreign exchange and payment platform that leverages blockchain settlement for fast, cost-effective payments to and from Africa.
Underdeveloped infrastructure creates opportunities
Infrastructure in emerging markets still lacks behind developing countries big time. While that’s a challenge, it’s also an opportunity. Instead of having to replace existing infrastructure and thus also having to deal with opposing corporate and political interests, emerging markets can build digital infrastructure from scratch.
Moreover, blockchain technology can help to solve problems in emerging markets, that are mostly non-existent in developing countries.
Startups such as Crowdforce or Moeda create blockchain-based applications to serve the underbanked populations in emerging markets. Tony’s Chocolonely has set out to make chocolate 100% slave free by increasing supply chain provenance and transparency. Statwig will use blockchain solutions to ensure the efficient delivery of vaccines in India through an enhanced supply-chain management system.
The list goes on. While blockchain technology can help to solve challenges and improve systems all over the world, the value proposition is often more attractive in emerging markets. That’s why it’s likely that many of the next-generation blockchain solutions won’t target developing economies, but emerging markets instead.
you are really a good webmaster. The site loading speed is amazing. It seems that you’re doing any unique trick. Furthermore, The contents are masterwork. you’ve done a fantastic job on this topic!
You made some respectable factors there. I regarded on the internet for the problem and found most people will associate with together with your website.
I simply could not depart your website before suggesting that I really enjoyed the usual info an individual supply for your visitors? Is going to be back incessantly in order to check out new posts
It’s hard to come by experienced people for this subject, but you seem like you know what you’re talking about! Thanks
Pretty part of content. I just stumbled upon your website and in accession capital to claim that I get actually enjoyed account your blog posts. Any way I?ll be subscribing in your feeds or even I success you get right of entry to constantly rapidly.
Hello, Neat post. There is an issue along with your website in internet explorer, may check this? IE still is the marketplace chief and a huge element of people will pass over your magnificent writing because of this problem.
What’s Happening i am new to this, I stumbled upon this I’ve found It positively useful and it has aided me out loads. I hope to contribute & assist other users like its aided me. Good job.
I have learned result-oriented things through the blog post. One other thing I have seen is that usually, FSBO sellers will probably reject people. Remember, they’d prefer to never use your expert services. But if anyone maintain a stable, professional romance, offering guide and being in contact for about four to five weeks, you will usually be capable to win a discussion. From there, a listing follows. Thanks a lot
Aw, this was a really good post. Finding the time and actual effort to make a superb articleÖ but what can I sayÖ I procrastinate a whole lot and don’t manage to get anything done.
Hi there, just became alert to your blog through Google, and found that it is really informative. I am going to watch out for brussels. I will appreciate if you continue this in future. Many people will be benefited from your writing. Cheers!