Mass crypto adoption is indeed taking place at a faster pace than ever before. However, according to Daniel Fogg of the smart contract platform Rootstock, this adoption is not occurring in the United States or Europe, and it isn’t Bitcoin that’s driving mainstream acceptance. Instead, the surge in adoption is happening in emerging markets, where cryptocurrencies offer much-needed solutions to pressing financial problems.
Fogg claims that emerging markets are at the forefront of crypto adoption for one primary reason – they often face significant macroeconomic challenges. Many people’s first significant digital banking experience will likely take place in these markets, using crypto rails in the next few years. “People on the streets have a pressing need to protect their income, to get access to U.S. dollars to get a loan. […] We’re seeing these massive shifts. For me, if you want to look at the future of what I hope crypto will become, it exists today in Turkey, Colombia, Nigeria, Argentina. It doesn’t exist today in the United States or the UK.”
As Fogg sees it, the crypto space is evolving through two main use cases. The first is focused on decentralized finance (DeFi) solutions for those seeking alternative investment opportunities and outsized returns. The second use case involves acquiring stablecoins pegged to the United States dollar for savings and everyday payments in economies grappling with inflation, devaluation, and other monetary issues.
Fogg makes an interesting observation about the future of DeFi: “I think there’s a kind of bifurcation in what DeFi could become, advanced DeFi, which is a lot of what I think the usage in America and Europe will be […], and then everyday DeFi, which is what you’re going to see in emerging markets every day.” Offering “scale opportunity” to retail finance, Fogg believes developing DeFi products for these markets is a key strategy for Rootstock and its sister company IOV Labs.
Discussing Bitcoin pragmatism, Fogg points out that although Bitcoin is an extraordinary innovation, it alone is not sufficient. According to him, the crypto space lacks an established use case for billions of users, which could take years to achieve: “In many cases, we think they’re paying, saving, borrowing, lending, retail finance, etc. But there are many other use cases as well. We have to experiment our way there. And if we are held back by a traditional conservative mindset around what Bitcoin could be, I think that’s to the world’s detriment.”
In conclusion, while Bitcoin continues to make headway, the true power of cryptocurrencies is perhaps better judged by their practical applications in emerging markets. As nations like Turkey, Colombia, Nigeria, and Argentina pave the way for crypto adoption, it seems that harnessing the potential of this technology on a global scale might prove instrumental in solving long-standing financial issues.
Source: Cointelegraph
