The crypto industry has for long advocated for the use of cryptocurrencies for all types of goods and services, but this vision does not fit well where cash-centric economies prevail. While spending money on creating wallets and apps for exchanges, crypto companies seem to overlook one important fact: out of 1.4 billion people worldwide, a significant number of physically unbanked individuals purely depend on cash. As a result, the solution to this growing argument lies in promoting cash-based crypto alternatives.
The Digital Divide: Disregarding the Cash Fundamentals
The cash digital duel reflects a sobering reality: in the context of Southern Africa, South East Asia, and Latin America cash is still a crucial part of everyday life even in the face of advanced technology. Additional challenges include poor banking, limited access to smart phones, and low or zero computer literacy, which are serious obstacles in realizing digital only crypto solutions. To many, this insistence on cashless operations is rather unrealistic and paradoxically discriminatory.”
Beyond the Developing World: Cash’s Enduring Presence
The reliance on cash is not confined to developing economies. Even in nations where technology is highly developed, cash transactions still remain important. The article cites case studies such as Romania, where 76% of transactions are still in cash, despite a 14% crypto adoption rate. In Morocco, cash controls the economy and digital payments are growing, yet 16% of people use crypto regardless of official bans. These cases show that people are trying to find new methods of using crypto, but the infrastructure available does not allow for such innovations.
A Missed Opportunity: The $50 Billion Prize
The source material posits that the crypto industry is leaving behind a huge financial opportunity, as ignoring cash economies will cultivate a $50 billion market in integrating crypto into cash-based economies. This calculation stems from examining the success of Romania and estimating the lower bound crypto success could face in other markets.
The Fix: Cash-Centric Adjustments to Fill In Gaps
The solution, per the article, involves figuring out ways to customize cryptocurrency to fit the financial behavior of populations that rely heavily on cash. It illustrates the need to design and provide opportunities for easier movement from tangible assets to digital ones.
Illustrative Suggestions: Blockchain-Backed Note Issuance and Others
The material sources outlines a few pragmatic suggestions:
Physical Banknotes tethered to blockchain: Issuance of cash banknotes which are tethered to switches on the blockchain for facilitation of cash-to-crypto conversion.
Crypto-Value Representation Via QR Codes: Employing QR code technology wherein crypto values to be represented and transactions can be done with ease for merchants within the neighborhood.
Text-Based Remittance: The ability to send crypto to other users through text messages or SMS is likely to get more people served through mass phones enabling to send value without smartphone and complicated applications.
M-Pesa’s Triumph: A Finding for Cryptocurrency?
Mobile money services like M-Pesa in Africa are easily recognizable as key success stories. M-Pesa operates on agency model with more than 66.2 million active subscribers. This allows people to change cash to a digital value even if they do not have a bank account. This model could be used for crypto through a system of trusted agents who purchase and sell cash notes embedded with blockchain technology.
Case Study of Early Adoption: Machankura
The article references Machankura, a service that allows Bitcoin transactions through basic mobile networks, as a successful example of this approach. In Africa, Machankura has garnered more than 13,600 users, proving the success of SMS-based crypto transfers where smartphone penetration is low.
The Cost of Inflexibility: Stalled Adoption
The researched document claims that the crypto industry’s focus on a digital-only model is slowing adoption the most. The removal of paper solutions is regarded as losing out on connecting with billions of possible users who are not part of the digital financial system.
Pragmatism and Inclusion as Untapped Strategy
A more inclusive, less strict approach is required if the industry really wants to revolutionize access to financial systems. This involves testing cash-integrated solutions, working with telecoms, and creating agent-based systems for cash-intensive economies. The future of crypto is closing the gap between the digital and analog world, so everyone can access the advantages of blockchain technology regardless of their means, technological access, or financial situation.
