Developing countries lag behind their developed counterparts in various categories, especially economically. Developing countries suffer from higher levels of poverty, lower literacy levels, social inequality, and limited access to opportunities compared to developed countries. Cryptocurrencies can change this through their unique advantages and features. You can start bitcoin trading using automated Artificial Intelligence based crypto trading platform
Bitcoin is the leading cryptocurrency to date. It has become so common that developing countries are now among the fastest-growing users. Overall, the rate of cryptocurrency adoption, particularly Bitcoin, is highest among these developing countries. Yet, these countries still have a long way to go to catch up with their developed counterparts.
Increasing Role of Bitcoin
Even before focusing on the specific ways Bitcoin plays an increasing role in developing countries, it is important to emphasize one point. The fact that many developing countries are now embracing Bitcoin indicates its increasing role. The growing number of Bitcoin users in these countries benefits more people and businesses.
We can understand Bitcoin’s increasing role in developing countries from these four perspectives.
Financial Inclusion
Among the critical problems in developing nations is financial inclusion. Many people lack bank accounts and cannot access or receive financial services. Various factors are responsible for this sad reality, including unemployment. And this has significant implications for the people. For example, you cannot perform some transactions without a bank account.
Bitcoin will address the problem of financial inclusion because it does not operate like a typical centralized currency system. Bitcoin’s decentralized nature means that anyone can use it. Many people that cannot have bank accounts or access other financial services can get a reprieve from Bitcoin. Ultimately, as more people turn to Bitcoin, more people will enjoy financial inclusion.
Social Trust
With high levels of social inequality, developing countries also tend to suffer from a lack of social trust. Additionally, corruption is rife in developing countries and runs from the top echelons of government to the lowest levels. Accessing services requires one to bribe officials, and this reduces the level of social trust overall.
Bitcoin operates on more trustworthy blockchain technology. Citizens and governments can trace how funds move by checking the relevant record in the blockchain. Essentially, this means Bitcoin is boosting social trust in these countries. And this has more positive ripple effects economically, as will be discussed below.
Poverty
Bitcoin also plays an increasing role in reducing poverty in developing countries. Poor governance and lack of financial inclusion are partly the reason for the high poverty levels. Since Bitcoin addresses the low financial inclusion problems and enhances social trust, it ultimately helps reduce poverty.
As more people gain access to financial services with Bitcoin, the cryptocurrency will empower them to engage in economic activities that will pull them out of poverty. For example, with Bitcoin, a farmer that could not access capital to boost his farming business will be able to do so and increase his income.
Economic Growth
Finally, Bitcoin plays an increasing role in boosting economic growth in developing countries. By increasing financial inclusion, Bitcoin ensures that more people can actively participate in economic activity.
With Bitcoin, developing countries realize significant growth in remittance payments. Since Bitcoin is convenient to transfer funds from anywhere in the world without government bureaucracies and other challenges, more people working in developed countries find it easier to remit money back home. This money boosts local economies.
Conclusion
Bitcoin has demonstrated its increasing role in enhancing financial inclusion, building social trust, reducing poverty and supporting economic growth in developing countries. The future looks bright for developing countries as they continue to adopt and use Bitcoin.
