Analyzing Crypto’s Potential to Expand Financial Inclusion in EMDEs
Gaudreau, Daniel (2024)
2024
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2024120231886
https://urn.fi/URN:NBN:fi:amk-2024120231886
Tiivistelmä
This thesis investigates the potential of cryptocurrencies and decentralized finance (DeFi) to expand financial inclusion in Emerging Markets and Developing Economies (EMDEs). With over 1.4 billion adults worldwide remaining unbanked, primarily in EMDEs, traditional financial systems (TradFi) often fail to address barriers such as limited access, high costs, and regulatory constraints. By analyzing the unique features of DeFi and its applications, particularly focusing on stablecoins and major cryptocurrencies like Bitcoin and Ethereum, the study explores how these digital innovations can complement or surpass TradFi in reaching underbanked populations.
The research employs a qualitative approach, utilizing literature reviews, case studies—including an in-depth examination of Nigeria—and comparative analyses of global political landscapes surrounding cryptocurrency adoption. The findings highlight two dominant pathways of crypto adoption: grassroots adoption in EMDEs driven by practical needs for financial access, and institutional adoption in developed economies characterized by regulatory integration and financial innovation.
The study concludes that cryptocurrencies and DeFi have significant potential to bridge financial gaps in EMDEs by providing accessible, cost-effective, and scalable financial solutions. However, realizing this potential requires coordinated efforts to overcome barriers such as regulatory uncertainty, technological literacy, and infrastructural limitations. The thesis offers insights for policymakers, businesses, and stakeholders on leveraging blockchain technology to foster sustainable economic growth and financial empowerment in underserved regions.
The research employs a qualitative approach, utilizing literature reviews, case studies—including an in-depth examination of Nigeria—and comparative analyses of global political landscapes surrounding cryptocurrency adoption. The findings highlight two dominant pathways of crypto adoption: grassroots adoption in EMDEs driven by practical needs for financial access, and institutional adoption in developed economies characterized by regulatory integration and financial innovation.
The study concludes that cryptocurrencies and DeFi have significant potential to bridge financial gaps in EMDEs by providing accessible, cost-effective, and scalable financial solutions. However, realizing this potential requires coordinated efforts to overcome barriers such as regulatory uncertainty, technological literacy, and infrastructural limitations. The thesis offers insights for policymakers, businesses, and stakeholders on leveraging blockchain technology to foster sustainable economic growth and financial empowerment in underserved regions.