Many crypto projects aim to achieve the unbanked and blockchain connection through crypto solutions of decentralized payments. Still, there are a lot of barriers to such development, especially when it comes to massive adoption.
New projects and partnerships all want to enter the unbanked sector. They aim to do this by providing solutions in terms of fees, transaction speed, and security. However, governmental crackdowns have slowed the ICO market, and the volatility of the industry bars the crypto world from the unbanked sector.
Link Between Unbanked and Blockchain
According to the World Bank’s data, about 1.7 billion individuals did not have access to banking products in 2017. However, that number had been steadily decreasing from 2014. For that year, the statistics show that around 2 billion were cut off from the financial industry. According to the analysis, FinTech companies, blockchain-based ones included, lead the way in terms of solutions. Right now, many blockchain networks compete for their place within the unbanked industry.
Last week saw several projects kickstarting operations while others are yet in talks. The Gates Foundation signed a deal with Coil for a new crypto-powered payment system. As for individual use, Beatrice Wambugu from Kenya used bitcoin trading as a source of income while living in a rural part of the country. New projects that try to connect the unbanked and blockchain are SALT, ETHLend, Ripio Credit Network, and others.
Barriers for Blockchain to Reach Masses
According to the data by IcoRating, Initial Coin Offering (ICO) projects have seen a sharp drop in collected funds. May 2018 is the record-holder with $1.9 billion, while September achieved only $429 million. According to the analysis by Invest8r, the continuous bear market and a large number of scams are what brought the blockchain market down. Also, government crackdowns in India and China pose a large obstacle to massive crypto adoption, barring the unbanked and blockchain connection.
Peter Zimmerman’s report pinpoints price volatility as the main factor that pushes the mainstream sectors away from the blockchain. Overall, many businesses and individuals still prefer stable fiat currencies to the highly fluctuating cryptos. For a larger adoption rate, a lot more development of the crypto solutions is needed. This can attract the unbanked sector to blockchain networks.