An African perspective why the world needs cryptocurrencies-op-e-eD
An African perspective why the world needs cryptocurrencies-op-e-eD
The increasing use of cryptocurrencies in Africa in recent years has not only shown that digital currencies are an important means today to move funds across borders and between people, but that cryptocurrencies are also an important means of gaining financially excluded access to global markets.
cryptocurrency now a necessity
Despite the continuing efforts of the regulatory authorities to limit the use or trade of cryptocurrencies, the number of users of such digital assets continues to grow. As some studies have shown repeatedly, cryptocurrencies such as Bitcoin, which are regarded or used as an alternative value, have become a need.
Apart from their volatility, cryptocurrencies or owners offer a certain amount of control over their assets, which they cannot do with fiat currencies. In fact, cryptocurrencies in countries that have been hit by inflation or unstable currencies offer an escape route that you have before the Financial crisis .For many, the use of cryptocurrencies or cryptocurrency rails for cross -border shipping has proven to be the most important and perhaps even the best application. Very few opponents of privately issued digital currencies will contradict the assessment. In fact, the cross-border shipping of Geldern Efficient When using cryptos such as xrp , Stellar or bitcoin-bargain as the use of traditional channels, both formal as well informal.
Wie die Situation in Nigeria vor der Blockade von Krypto-Einheiten aus dem Bankenökosystem gezeigt hat, cryptocurrency -based transfers have the potential to exceed the regular channels for money shipping. In addition to the rapid money transfer, Nigerian migrants were able to handle the many intermediaries in the form of cryptocurrencies that are traditionally involved in cross -border transactions.
For the senders, this meant much lower costs for sending funds to their loved ones, while for the recipients in Nigeria cryptocurrencies-which cannot be checked or censored as easily as Fiat money-gave them the opportunity to use the funds using the stock exchange course instead of the overgrown official stock exchange. In fact, it was partly this reason that prompted the central bank of Nigeria (CBN) to finally act against crypto companies on February 5, 2021.
Of course, this act and the following steps of the CBN did not destroy the popularity of cryptocurrencies in Nigeria, as the authorities had hoped. Rather, the restrictions have so far only been beneficial Peer-to-peer-bitcoin trade , as the data of useful tulips from the past nine months suggest. This failure of the regulatory action of the CBN and many other regulators worldwide once again proves that a sensible innovation cannot be stopped by regulation.
Access to the global financial markets
The perhaps less discussed but equally important application of cryptocurrencies is the trade option and the access that they offer people in less developed countries. In fact, access to certain financial products in many of these regions is restricted by factors that range from the size of the financial system of a country to its GDP. In certain cases, access to certain financial services actually depends on the relationship between a less developed country and its more developed objects.
In the case of frosty relationships, the chances are good that access to the global financial system and the associated services will be severely restricted. For example, a citizen of Zimbabwes who is interested in acting stocks at the New York Stock Exchange or buying goods from Amazon can be prevented from doing this directly because Ofac sanctions. With certain cryptocurrency platforms, the same Zimbabwische nationals can actually buy hot global stocks such as Tesla, Amazon, Microsoft, etc. In other words, dealers from Africa are exposed to some of the most liquid markets and most profitable shares in the world through cryptocurrencies.In addition to the use of cryptocurrencies for trade in Fiat shares, retailers on the African continent can also act on many global cryptocurrency platforms for 24 hours a day. In fact, you can and have, other forms of crypto trade, including staking, risky futures and margin trading. All of this is possible because everyone can be kept by anyone, including those who are financially excluded.
fight against crypto: an exercise in senselessness
As much as the regulatory authorities want to stop or restrict cryptocurrencies, the reality is that Krypto has opened the door too many options. Therefore, the attempt to prohibit the use or trade of cryptocurrencies without offering anything better or making the current financial system an advantage for everyone is probably a senseless exercise.
This fact should be clear African countries that have so far copied and inserted everything that their western counterparts have done to stop or restrict the use of cryptocurrencies. The African central banks and supervisory authorities should also be clear that the introduction of a digital central bank currency (CBDC) alone will not restore confidence in a currency.
As soon as a currency falls, it takes a lot more than you only give a different name so that the population believes in it again. Instead of trying to prevent people from using cryptocurrencies, a clever regulatory authority should therefore consider the popularity of crypto-assets as a measure of the lack of trust in a financial system. Such an understanding of the popularity of cryptocurrencies should help the African central banks to find the appropriate regulatory answer.
What do you think about this story? Tell us your opinion in the comments below.
Bedy verification : Shutterstock, Pixabay, Wiki Commons