Opinion by Ayush Ranjan, Co-Founder and CEO of Huddle01
Many critics claim that Web3 is little more than a speculative playground, where memes trump actual utility, and overnight millionaires are made. Long-term builders and dreamers can quickly lose faith in the industry’s future. However, despite the media narratives, there are many bright spots.
Blockchain and Crypto: A Force for Good
The truth is that blockchain and crypto are genuinely benefiting humanity, especially in emerging markets. Web3 technology is helping to address the deficiencies in modern traditional institutions in finance and beyond. It’s combatting the uneven value distribution that exists worldwide and providing a lifeline to the underserved and underbanked.
Investment Opportunities Abound
Emerging markets are leading the charge when it comes to crypto adoption. According to the World Bank, 1.4 billion people worldwide remain unbanked as of 2024. Decentralization is fundamentally about addressing uneven value distribution, and the industry needs to support more builders who are committed to driving change.
Africa: A Hotbed for Crypto Adoption
Sub-Saharan Africa is one of the regions that’s leading the charge in crypto adoption. The lack of access to banking services severely limits people’s ability to conduct everyday transactions, save, and invest. However, crypto is changing this narrative.
Decentralization and Access
According to Chainalysis’ 2024 Global Crypto Adoption Index, developing nations dominate the rankings, with countries such as India, Indonesia, and Nigeria leading the way. As of 2023, Sub-Saharan Africa had the highest Bitcoin (BTC) adoption rate in the world, with Nigeria ranking second globally on the Global Crypto Adoption Index.
By mid-2023, Sub-Saharan Africa accounted for 2.3% of global cryptocurrency transaction volume, receiving around $117.1 billion in on-chain value. In these geographies, crypto serves practical purposes beyond just speculation.
Functionality is Advancing
In emerging markets, we’re witnessing the functional use of crypto rather than its use as a speculative asset. Local entrepreneurs with first-hand insights into local problems are driving meaningful change, and new technological innovations fit for purpose.
Real-World Applications
Initiatives like CARE’s pilot programs in Kenya and Ecuador demonstrate how crypto can provide access to essential goods and services while fostering economic recovery from the COVID-19 pandemic. Non-fungible tokens have become accepted cross-border fundraising vehicles.
Governance Problems Drive Adoption
Acute governance problems can also mean adoption is growing by necessity. Recent examples include:
- The Indian city of Raipur putting real estate records on the blockchain with an innovative encryption startup called Airchains.
- This blockchain-based solution aims to prevent forgery and reduce processing time from a month to three days.
Fund Adoption, Not Shiny New Things
While capital flows into crypto projects in emerging markets are becoming more significant, they still fall short compared to the funding available for projects in well-developed nations. In 2023, developed nations, particularly the United States, led with approximately $1.975 billion invested in Q3 alone, with US-based companies accounting for 34.5% of all crypto VC funding.
Investing in Emerging Markets
However, lately, there’s been a growing recognition of the potential in emerging markets. Crypto investment should now pay attention to where mass adoption is happening. Crypto is a functional tool rather than a speculative asset in emerging markets.
Conclusion
In conclusion, blockchain and crypto are genuinely benefiting humanity, especially in emerging markets. Web3 technology is helping address uneven value distribution and providing a lifeline to the underserved and underbanked.
Investment opportunities abound, and emerging markets dominate adoption rankings. Functionality is advancing, with local entrepreneurs driving meaningful change and new technological innovations fit for purpose.
Governance problems are driving adoption by necessity, but investment should focus on fund adoption rather than shiny new things. By supporting more builders who are committed to driving change, we can unlock economic opportunities for emerging markets.
Cointelegraph
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Subscribe to our Crypto Biz newsletter:
- Weekly snapshot of key business trends in blockchain and crypto
- From startup buzz to regulatory shifts
- Gain valuable insights to navigate the market and spot financial opportunities.