By Emma Okonji
A recent research survey sponsored by Luno, one of the promoters of cryptocurrency, has shown that people who have less finances appear to take greater financial risks, thus confirming the possibility of high adoption rate of cryptocurrency in emerging markets.
The initial findings from the survey tagged ‘Future of Money’, which took the views of more than 7000 respondents across Europe, Africa and South-east Asia helped in explaining the belief on emerging markets and financial risk taking.
As large global tech firms start to move into blockchain and altcoins, the research shows why early adopters, the most important audience for these firms, would probably come from emerging markets.
Analysing the survey report, Luno CEO, Marcus Swanepoel, said: “As some of the world’s largest tech giants announce they are launching cryptocurrency coins, we believe developing markets will be the lead adopters. Our research shows that in these markets people are more financially savvy because they have to be, which means that they need and understand the benefits the new coins can offer.”
When asked if a single global currency would make the current financial system better or worse, almost three times as many respondents from Nigeria and South Africa said it would make it better, compared to the UK, Swanepoel said.
According to him, “The data also identified why money is such a focus in emerging markets. When asked why money is important to them, 60 per cent respondents said it was ’to secure my family’s well-being or to ‘pay for my education. In Nigeria 25 per cent of the respondents said same, compared to 8 per cent in the UK. A further question regarding the setting of a monthly expenditure budget found that 80 per cent of people in Malaysia; 65 per cent in Nigeria; 73 per cent in South Africa and 74 per cent in Indonesia, said they do, compared to 54 per cent in the UK. Again, 33 per cent respondents in Indonesia compared to 0 per cent in the UK, are more likely to stay within the budget they set.”
The survey report added: “It is very clear that if money is not simply a ‘nice to have’ and is vital for the future, then people spend more time understanding it, managing it, preserving it and to an extent being creative with how they maximise the use of it. The report therefore asserted that if a cryptocurrency could provide a secure and cheaper means of exchanging value, better than the existing system, it would be used. This is why there is a general belief that as new cryptocurrencies, linked to global brands are introduced they will find an important audience in emerging markets.”
These markets are also more likely to exhibit grassroots level adoption, Swanepoel said, adding “In almost every emerging market country surveyed, over half of the people said they will turn to family, friends or colleagues for financial advice over government organisations which shows that people in these markets rely on information from those closest to them”
The survey presents an overview of a study conducted by Dalia Research for Luno between May and June this year about the future of money. The sample of over 7,000 individuals with internet access was drawn in France, Indonesia, Italy, Malaysia, Nigeria, South Africa and the United Kingdom.