How Crypto is Beating Inflation in Developing Nations

One of the greatest challenges that most developing countries have today is inflation. Goods and services continue to increase in price whereas the value of money continues to decrease. It is something I see every day, as a person living in a country like Nigeria. The prices of food, transport and even the school fees are going up every minute. The problem is that many individuals find it hard since their salaries or small enterprises could not sustain the increase of the living standard. Amid this challenge, there has been a shocking factor that has been assisting people and that is cryptocurrency.

Crypto is not a word or game of the wealthy. It is being used as an instrument of combating inflation in most developing nations. Bitcoin, Ethereum, and other stablecoins are providing individuals with an opportunity to preserve the worth of their money. Many young people consider crypto a safe store of value, unlike the naira that depreciates practically on a monthly basis.

Take Bitcoin for example. However, although this price fluctuates, and with time it has become very robust than most local currencies in third world countries. When an individual saved N100,000 worth of cash last year, the money cannot be worth the same today due to inflation. However, had the same sum been changed to Bitcoin at the appropriate moment, it can have even gone up in value. That is why most of the people are referring to Bitcoin as digital gold. Personally, I understand the reasons behind the belief of people in it, as having money in the bank is sometimes like the feeling of money going down the drain.

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Stablecoins such as the USDT and the USDC are also quite essential. They are pegged to the US dollar, and this implies that they are stable. The majority of Nigerians and individuals in such countries as Argentina, Venezuela, and Kenya save their money on stablecoins. Having the local currency weakened due to inflation, people have a sense of security when converted to stablecoins. It is almost similar to having the dollars without the need to have a foreign bank account. Most of my friends use stablecoins to save their money rather than save in naira since they do not wish to lose the value of their hard earned money.

There is yet another way in which crypto is winning inflation in form of remittances. Most families in the developing countries rely on the remittances of their relatives. Previously the process of transferring money via banks or money transfer companies was slow and costly. At last, it is cheaper and faster with crypto. An individual can transfer Bitcoin or stablecoins within minutes and the recipient will soon change it into local currency. This will assist families to derive greater value on what is being sent rather than most of it going to waste in transfer charges.

Crypto is also providing individuals in the third world countries with an opportunity to make money around the world. Lots of young people are currently working on-line and paid in crypto. In this manner, they are not restricted by the poor local currency. As an illustration, a Nigerian freelancer that earns in Bitcoin or USDT is not subjected to the impact of inflation in naira. This gives new hope to the youths who are in need of financial independence.

Naturally, crypto is not ideal. The value of such coins as Bitcoin and Ethereum can be highly fluctuating. Some governments are also not receptive to crypto and thus making it difficult to access and use it freely. Nevertheless, the adoption continues to increase in spite of these challenges. The advantage of taking the risk of using crypto is that people would rather face the risk of using crypto than sitting back and watching their local currency go down everyday.

In places such as Venezuela and Zimbabwe, where inflation is at a very high level, crypto has been close to a lifeline. Individuals exchange currencies and goods and services in the form of digital currency since their local currency has lost its sense. Crypto remains popular in Nigeria despite the government restrictions. This demonstrates the strength that it has gained as an alternative.

To sum up, crypto is gradually altering the monetary narrative of developing countries. It provides the common man with the opportunity of saving, transferring, as well as making money in a stronger manner than the poor local currencies. Personally, as a Nigerian, I regard crypto as not an investment, but a survival tool in case of inflation. Although no one can be certain about what will happen in the future, one thing remains evident: crypto has already begun to outsmart inflation in the developing countries, and the effect it will have is only going to increase.