Key Challenges for mass adoption of Cryptocurrency in emerging nations
Blockchain is one of the most revolutionary developments of the current era. Primarily used for crypto currency Blockchain has found uses in other sectors too- right from healthcare to education. There is a wide consensus among people in the technology’s potential- especially in terms of crypto currency, to propel development among marginalized communities in emerging nations. While it is true, there are several challenges to overcome to experience real mass-level outcomes.
Here are a few challenges to address immediately:
How can crypto currency help marginalized communities?
The lack of awareness and basic education among people in developing nations has kept them away from availing of banking services. Besides, the understaffed banks don’t help much to assist marginalized communities in banking operations. With the help of Blockchain, these communities can pay and receive money right through a basic smartphone, and with a negligible learning curve, they can also manage their budget.
It will empower them to gain more control over their finances, review their monthly budget, and optimize their income/savings accordingly. Moreover, it can help people become more serious about money management, which is vital to improving their financial condition bit by bit.
Another key issue that can be solved by blockchain is that of loans. Due to poverty, a majority of people in developing nations take loans, and many of them rely on conventional loan providers. These loan providers generally impose higher interest rates with their stipulated conditions and timelines to repay loans. Frauds are common, and people generally have to keep their meager assets at stake.
With the help of Blockchain-powered credit facilities, people will be able to avail loans at fair rates, complete transparency, and reasonable conditions. They may also calculate the installment to decide the repayment tenure they are most comfortable with. Being irreversible and transparent, Blockchain also ensures a high level of security.
Challenges for mass-level adoption of cryptocurrency in developing countries
While there are bright prospects for using Blockchain in developing nations as a vehicle for economic development and financial inclusion, its journey is not easy due to the challenges. A keen review of these challenges can help in coming up with practical solutions to make the journey easier.
For the uninformed, the benefits of blockchain lie in its power to blend security and transparency without compromising either of them. Being decentralized, it empowers people to execute operations without intermediaries or central authorities.
Infrastructure Challenges
A reliable network infrastructure and uninterrupted connectivity are absolutely vital for powering Blockchain. While some countries like India have made significant developments in this regard, many regions are still lagging behind.
Ironically, the list includes countries with issues where Blockchain has a tremendous purpose to serve, for instance, African countries like Kenya, Latin American regions suffering from political upheaval, and other regions with high corruption rates.
Education and Awareness
Developing and executing blockchain technology needs extensive technical expertise. It is also important to raise awareness among conventional businesses about the operational and business benefits of blockchain. Due to the substandard educational systems of emerging nations, expecting reliable learning access to sophisticated technologies like blockchain is a far-fetched dream.
Also, any hasty or half-hearted endeavor in this area may do more harm than good by sacrificing quality for the sake of volume. To deliver reliable outputs, Blockchain not only needs more headcounts but also solid caliber.
Regulation Challenges
Standard global regulations around blockchain don’t exist, and different countries have different regulatory terms. The foggy regulations and unclear guidelines can not only disturb the real-world use of blockchain but may also attract the attention of unscrupulous elements to exploit the technology for their vested interests by finding legal vulnerabilities.
Financial structure Challenges
Developing, implementing, and running blockchain is not an easy or cheap affair. It demands heavy investment in technology, energy consumption, and manpower. A majority of emerging nations lack such a volume of funds. Also, most of the businesses in these countries lack both the budget and work culture to use blockchain technology.
With the government lacking a sufficient budget for basic development tasks, it is quite impractical to expect nationwide blockchain initiatives to facilitate mass access.
Lack of Trust
When compared with developed nations, the trust in and integration of digital technology in emerging nations is comparatively very low. Also, the political decision-makers are more hesitant to adopt any new system or technology.
Besides, the general public is more suspicious of using foreign ways of doing things, especially when it’s related to sensitive tasks like money or healthcare. It can pose a big challenge for blockchain technology.
Scalability Issues
The lack of scalability is already a problem with blockchain. In the context of emerging nations, this issue is even more challenging, as many such nations have a huge and fast-increasing population and a higher percentage of underserved communities.
With their increasing digital demands and low availability, it is quite difficult for blockchain to scale up to meet the expectations.
