news.coincu.com 7 h Reading time: ~2 m In countries where most people don’t have bank accounts, national currencies are no longer reliable for storing value. Remittances, which make up a large part of GDP, are crucial for survival. However, international sanctions can make connecting with the global economy difficult. Bitcoin provides a way for people who would otherwise be left out to access the financial system.
Moving money on the bitcoin blockchain at its base layer can be complicated and costly, especially for people living in remote and rural areas with limited commercial bank branch access. Digital banking options are also limited. Rampant hyperinflation, widespread government corruption, and capital controls trapping domestic cash in banks can make it difficult to move money.
Fortunately, Bitcoin’s Lightning Network helps alleviate the challenges of moving money on the bitcoin blockchain at its base layer. It slashes the cost of transactions to virtually zero and enables nearly instantaneous payments around the world. This technology has the potential to reduce the cost of transactions and enable people to send digital payments directly to one another without relying on credit and without incurring multiple settlement fees along the way.
In Africa, companies like Western Union and MoneyGram have an extensive physical network of storefronts catering to unbanked people. Bitcoin, however, could potentially replace these intermediaries entirely. This would enable people to send digital payments directly to each other without relying on credit and without incurring multiple settlement fees. As more and more people adopt cryptocurrencies, it will take away all the oxygen from governments attempting to control behavior through financial oppression.
The entire banking system in Africa is broken, even amongst mobile money providers. There are two thousand payment networks and only 2% talk to each other. However, entrepreneurs on the ground in Accra are building a new financial system that will provide greater financial inclusion and help drive economic growth and development across the continent. Ultimately, Bitcoin brings financial power to people who would otherwise have none.
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