What's Up Crypto Revolutionaries?
Today we're going to be talking about the problem of buying BTC without a bank account, something that will need to be done if BTC is going to revolutionise money in the developing world. I'm talking about BTC and other cryptocurrencies here, so every time I say BTC you can insert whatever crypto YOU think will be the dominant form of money in the future, I'm using BTC because it currently is the dominant Crypto.
As I'm sure many are aware, BTC has the ability to help so many people across the world, especially those in developing countries. This is because those people are much more likely to be unbanked, and earn all of their money through direct physical cash payments. The physical payment method is inefficient for the employer (they have to get out exactly the right amount of money, or have that money), it's unsafe (the money can be easily stolen or lost) and it is inefficient for the governments as they can't tax it (in any meaningful way).
Over 2 billion people across the world are like this, 40% of the population. Some of the worst areas are the Middle East and Sub Saharan Africa where only 14% and 35% of people have bank accounts respectively. On top of this corruption is rife due to the endemic circulation of physical currency. Many of these people now have access to phones and internet and therefore can use BTC and other Cryptocurrencies.
BTC can solve these problems through distribution, taxation and safety. However, there exists a kind of paradox today that in nearly all cases buying BTC requires a bank account, to pay in FIAT. I will propose various methods of solving this problem and what could be done to bring these people into a safer economy.
Of course for any goods there is the possibility of face to face transactions, buying BTC from someone just there, giving them the money and watching as they transfer you the BTC. However this method is wholly unsafe, as at the point of sale both parties are vulnerable to manipulation and theft. This method would also take time with the current confirmation time of BTC, something which is not a liberty for many people. This method therefore is pretty bad and not very useful for the unbanked world. So we must find new and alternative methods.
One such important method could be the payment of employees with BTC and other cryptocurrencies. A BTC transfer every month would be a great method to start these crypto economies within these countries. This only works if the company of employer is big enough or rich enough to own a bank account however. So not great for small companies or self employers, but could start a ripple effect as some people start using BTC and then BTC begins to spread around the local population. One possible problem is employers exploiting BTC and paying less than they should, however this is up to local authorities to make sure their employment law is up to scratch.
Governments could start to implement crypto exchanges where you turn up with real money and exchange to virtual, however I can't see any governments enacting this as they won't see the benefit. There would however be a benefit if the wallets were known to the gov.s and then they could tax income. However, this seems almost contrary to the idea of blockchain and decentralisation.
One exciting method that could be implemented involves charities. Currently charities and international aid is often sent to governments or local authorities in these countries, where sadly much of the money is lost to corruption. However if charities and governments could set up decentralised donation services, such as donating money to people directly through BTC and local projects directly, it could set up a revolution in the economies of these countries. This could improve lives dramatically and make sure no money (or BTC) is wasted. This method needs lots of work, but nothing ever came for free. For example people would need to open wallets and sign up to a charity database for example to get donated the money. Governments may also be pretty disappointed because they no longer have control of their aid or money, but this could all be a good thing in the long run.
In conclusion many of these countries could hugely benefit from the influence of cryptocurrency, and the unbanked population would become economically much safer. However lots still needs to be done and the exact method is so far yet to be determined. Hopefully as BTC and crypto become more widely accepted, these methods start coming to the forefront of our minds, if not for us, for the unbanked people across the world.
That's all for today folks, hope you enjoyed. Thanks for reading and the upvote! All social and donation links are below.
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