Using cryptocurrencies to promote financial inclusion

The growing role of cryptocurrencies in financial inclusion is an important milestone in the modern economy, especially in regions and communities where access to traditional banking services is limited.

According to the World Bank, about 31 percent of the world's population, or about 1.7 billion adults, do not have a bank account.

The majority of these people live in developing countries and are often excluded from traditional financial systems because of poverty, distance, low education levels and gender discrimination. This is where cryptocurrency comes in, offering an opportunity for financial inclusion.

Cryptocurrencies allow people to make financial transactions directly, without intermediaries.

Users only need a smartphone and an internet connection to interact with cryptocurrencies, potentially enabling access to banking services in more isolated parts of the world.

The cost of financial transactions is also often lower for cryptocurrencies than for traditional banking transactions.

This is particularly important for cross-border transfers, where fees can often be as high as 5-10% of the value of the transaction. By contrast, cryptocurrencies such as Bitcoin allow users to send money almost instantly and at minimal cost anywhere in the world.

Last but not least, cryptocurrencies and blockchain technology enable innovative financial services such as microcredit, peer-to-peer lending and insurance, making financial products accessible to those who are rejected by traditional systems.

However, it is important to note that the promise of using cryptocurrencies to promote financial inclusion has not yet been fully realised.

Cryptocurrencies are still relatively complex and incomprehensible to most people, and their volatility and lack of regulation means that they carry significant risks!

However, as technology evolves and user interfaces become simpler, cryptocurrencies can play an increasing role in promoting financial inclusion.