Why Crypto Adoption Is Exploding in Developing Nations

The pace of encroachment of cryptocurrency in developing countries is one of the major trends in the financial world in the past couple of years. Nations such as Nigeria, Kenya, Venezuela, and the Philippines have emerged as some of the biggest crypto users in the globe. Although in most high-income countries crypto is nothing more than a means of investment, in less developed states crypto takes the next step it becomes a means of survival, freedom, and opportunity. The question the mind of many would pose is: why is the crypto adoption taking off in these locations? It is quite easy. The challenges of life in the developing nations have forced the citizens to seek alternative and improved alternatives and cryptocurrency has offered the same.

Inflation and poor currencies are also one of the primary reasons as to why crypto is gaining momentum at a fast rate in developing nations. The naira in Nigeria has consistently lost value, most times in the course of the last several years. The same thing which cost 1000 naira in 2015, has not been able to purchase the said thing today. Citizens are fed up with depositing money in the security institutions only to find out that money has been devalued.

Cryptocurrency, and stablecoins like USDT in particular, present individuals with a means of holding their money in a more stable currency than the naira. As an example, several Nigerians are transforming their savings into USDT, in order to cushion themselves against inflation. The same case was observed in Venezuela whose native currency, the bolivar, has lost almost all its value. Citizens of such countries now consider crypto a better method to preserve their financial resources.

The second reason why crypto is taking off in developing countries is the availability of inadequate banking facilities by a lot of individuals. The rural communities in Nigeria still have unbanked individuals. Bank services can be costly and time consuming even in cities.

This dilemma is resolved by cryptocurrency. The only thing one must have is a smartphone and an internet connection. You can store, send and receive money not via a bank with a wallet. That is the reason behind lots of the unbanked in Africa and Asia turning to crypto at the moment. It helps them to get financial freedom which old banks could not do.

Many developing countries live off remittances i.e. money those at home send back to the family. These remittances usually pass through the service companies such as Western Union or banks that charge excessive fees and take days to work.

Money transfer in foreign countries is faster and cheaper with cryptocurrency. A Nigerian in the UK can wire his/her family in Nigeria with USDT or Bitcoin and they wires them back within minutes at a minimal fee. This is among the largest motivations as to why there has been rapid development in adoption of crypto. Individuals are done paying a lot of money on fees or spending so much time transferring.

Crypto does not go well with governments in most developing countries. As an example in Nigeria, the Central Bank at one point placed limitations on transactions in crypto, which required banks to cease conducting transactions with crypto users. It did not kill crypto, it just caused people to go over to peer to peer (P2P) trading. The restrictions did not take long and made Nigerians switch to using P2P platforms such as Binance.

This indicates how hard working individuals are in the third world. In situations where the life is made more difficult by government policies, individuals ensure survival. Crypto has now become a financial liberation device and has allowed individuals to trade, invest, and transfer money without being overly reliant on government regulations.

The motivation to earn money is another major factor that stimulated the emergence of crypto in the developing countries. Numerous youth perceive crypto as an opportunity to get out of poverty. People in developing countries are making profits out of crypto through trading, to staking, to airdrops and nonfungible tokens.

To cite just one emblematic example, in Nigeria, where large numbers of young graduates were failing to secure employment, crypto-related activities help them to survive. Others earn by trading on P2P sites, some are freelancers who receive payment in cryptocurrency, others invest in decentralized finance (DeFi). Although this is risky crypto, the chances of earning money are very appealing, and it is finally a lucrative venture in the nations in which employment is limited.

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There are highly young populations in developing countries. More than 60 percent of the Africa population is under 25 years. This young generation is highly technology friendly and it is constantly active in seeking newer means to grow. The young are enthusiastic about crypto unlike people in older generations who might not trust digital money.

On Twitter (X) and Telegram groups, young people in Nigeria never cease to speak of crypto trends. There are thousands who have also educated themselves on how to trade as well as on the use of decentralized exchanges. It is one of the reasons why adoption is gaining so much pace mainly due to this energy of the youth.

Others include the suspicion of the government and banks. Respect towards leaders has been lost by many people in developing countries. Lack of integrity, poor governance with dishonest and fluctuating policies has compelled the citizens to seek alternatives.

Crypto is appealing since it relies neither on the government nor a singular authority. It is in decentralized form. Individuals are much at peace enjoying the fact that their money is not in the hands of politicians or banks which can collapse. In the case of Nigerians who had to live through the shortage of cash in early 2023, when it was almost impossible to find enough naira notes even in banks, crypto came as a savior.

It is no longer in the developing countries that crypto is used as an investment tool. Crypto payment is accepted by a lot of small businesses now. In Nigeria, there is a strong tendency among freelancers to request payment in USDT or Bitcoin rather than in naira since it is preserving its value better. In such places as the Philippines, employees in the gig economy are earning salaries through the use of crypto wallets.

This application in the everyday life contributes more to the dissemination of crypto adoption. It does not fulfill the previous concept of people seeing it as future technology anymore but as something that can be applied today to solve real problems.

The significance of the role of the social media cannot be ignored. In Nigeria, there are Telegram and WhatsApp groups in which individuals educate one another on crypto. Knowledge is also being disseminated through the YouTube channels and Twitter influencers. The free education is shooting more individuals into crypto.

As opposed to traditional finance whereby learning can last years, crypto learning is emerging rapidly due to peer-to-peer learning. Individuals in emerging countries are not biding their time until they learn in schools; they are learning on their own, as well as teaching others.

The fact that crypto crossed the entire world and saw a surge in usage in these developing countries is an indicator that the world is willing to accept change. Though there are certain risks associated with it, such as scams, hacks, price volatility, the advantages outweigh any of them. Crypto is not only a money-making business to many in countries such as Nigeria. It is concerned with staying alive, avoiding inflation, not having restrictions and looking forward to having an improved financial structure.

Because the technology is advancing and increasing numbers of individuals learn how to use crypto without risking their lives, it will keep on growing. Governments can attempt to control it but it is the reality that people have already accepted it. Digital money is the way forward in emerging countries and crypto is sounding the charge.

In the developing countries, cryptocurrency adoption is exploding due to the poor currency values, the high inflation rates, the weak banking flexibility, and the high barriers to accessing banking solutions by the state. Cryptocurrency provides speed, liberty and an opportunity to the new generation.

To the Nigerians, crypto has emerged as a means of safeguarding savings, sending and receiving funds as well as generating alternative sources of revenue. What is evident is that whereas in the first world crypto is an option, in the developing world it is a necessity. And when something is the necessity, its development can not be given a halt.