Developing economies are once again leapfrogging prior waves of technological innovation with the help of Cryptocurrency.
Much like the way consumers in India and Indonesia a decade ago skipped landlines for cellphones, institutions in Africa are embracing the advancements in crypto over alternatives offered by the traditional plumbing of the global financial system.
As Elizabeth Rossiello, founder of the Africa-focused fintech platform AZA Finance described at Yahoo Finance’s All Markets Summit Plus conference, crypto is helping improve everything from issues around Africa’s cross-border payments to operating during banking holidays tied to a dollar-dominated system.
“When we’re trading between continents that don’t involve the dollar, why should we be using dollar legacy infrastructure? That might sound radical, but it really doesn’t make a lot of sense to trade from West Africa to the U.S. and then back to South Africa in almost a triangle,” she said.
Instead, the institutions in the more than 100 countries her company operates in have increasingly turned to crypto trading to operate more efficiently. As Rossiello described, some financial institutions have taken up using stablecoins, or cryptocurrencies that are meant to stay pegged to the dollar, instead of having to transact in dollars attached to the traditional banking system. It’s not universal across the board, and much more of a complementary option rather than a replacement in its current scope, but it’s another option in the toolkit that has been tapped by some institutions working with her company since it launched the first Africa-based crypto exchange.
(Except for the headline, this story has not been edited by The Finance World staff and is published from a syndicated feed.)
