There has been a growing crypto adoption in the last couple of years. These digital assets have now become one of the popular investment options for investors and traders globally. Statistics show that there is an increase in crypto adoption.
However, it isn’t coming from well-developed economies like the US or the EU. In fact, it is the emerging markets throughout different regions that are showing interest in crypto asset ownership.
Daniel Fogg from IOV Labs said at the Bitcoin Builders Conference that emerging markets are playing a major role in changing the scope of the crypto scape.
Massive Crypto Adoption in Various Parts of the World
Massive crypto adoption is happening across the globe but the one thing that is worth noting is that it is neither coming from the United States of Europe nor does it have Bitcoin have the flagship asset for wide acceptance.
As per Fogg, there is a growing trend and an increased adoption throughout emerging markets. He added that people are turning towards cryptocurrencies in a bid to resolve their day-to-day problems.
Fogg further added that countries that facing the most significant macroeconomic challenges are leading the way in crypto adoption. As a result, there are seeing a much quicker adoption of virtual currency than other countries, such as the UK, the US, and the EU.
He expressed his perspective that people will have their first digital banking experience on the crypto rails shortly and this would happen in the emerging economies.
“People in these countries are looking for ways to ensure that their income doesn’t lose its value, and they continue to have access to the U.S. dollars,” Fogg said.
He further added that “I believe the future of what crypto will become is found in Turkey, Argentina, Philippines, Nigeria, and Columbia, rather than the United Kingdom or the United States.
Crypto Space Growing Via Two Significant Crypto Use Cases
According to Fogg, there are two main reasons why the crypto space is evolving throughout the emerging market. The first one is regarding the decentralized finance (DeFi) solutions that investors use for seeking outsized returns and diversifying their investment portfolios.
The other use case entails people in the emerging market acquiring the stablecoins since their value is pegged to the fiat currencies, mainly the U.S. dollar. That way, they can use it for making daily payments and as a hedge against inflation and devaluation.
Most countries globally are experiencing hyperinflation rates due to the global changes in the last couple of years. As a result, it is also leading to a massive devaluation in the currencies’ value as well.
So, in a bid to save their money from losing their purchasing power, most people are turning towards this digital asset. This is mostly the case with Turkey, Argentina, and the Philippines, where skyrocketing inflation is causing people to invest in crypto assets.
“Scale Opportunity” Available in Emerging Markets
Fogg pointed out that emerging markets offer “scale opportunity” for the retail finance sector. He added that creating DeFi products is the primary objective for IOV Labs and Rootstock — its sister company.
Talking about Bitcoin pragmatism, he acknowledges that it is undoubtedly a great innovation, but it is not adequate on its own. As Fogg said, “There isn’t a use case for the billions of users online and it may take a while to achieve that.”
“In most instances, we think that they’re making payments, lending money, or saving through cryptocurrencies. However, there are many use cases that we can potentially find out if you can experience your way there” He said.