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I am struggling to see how cryptocurrencies would have any tangible advantage over US Dollars in developing nations. Remember that in many of these countries,

I am struggling to see how cryptocurrencies would have any tangible advantage over US Dollars in developing nations. Remember that in many of these countries, most people don't have smart phones, and there's a lot of people who don't even have phones. Electricity and internet connections are intermittent at best. Good luck convincing Cambodian street hawkers that your magic internet money is better than a good old fashioned Greenback. And another reason that cryptocurrencies will struggle to catch on: it's hard to bribe people with magic internet money. There's no paper trail or proof if you bribe someone with cash.

root_axis 9y ago
Indeed. It also requires considerable levels of technical literacy to use, maintain, and properly secure blockchain tokens, and even with all that people regularly have their bitcoins stolen or irreparably lost.
- hanselot 9y ago
  I love how Fiat Money was designed to be impossible to use for illegal purposes, and there is no way to steal it. I mean really, if there were a way for it to be used in that way, surely your argument would be pointless, but luckily we know that the more middlemen we introduce between us and another party, the more affordable the transaction will become.
  - root_axis 9y ago
    > I love how Fiat Money was designed to be impossible to use for illegal purposes, and there is no way to steal it. So, I catch the meaning behind your sarcastic quip, but all you're doing here is offering up an absurd strawman. Obviously any currency can be stolen or used for illegal purposes, that's a willfully disingenuous interpretation of the argument because nobody has ever said that. This kind of reasoning would be like if someone said "the nature of dynamic typing makes the code prone to error" and you respond with "I love how strong static types were designed to make bugs impossible to produce, and there is no way it will cause the program to crash unexpectedly".
    - hanselot 9y ago
      > and even with all that people regularly have their bitcoins stolen or irreparably lost. > Obviously any currency can be stolen or used for illegal purposes So what is the purpose of your argument if all of that simply points out that any currency can be stolen or misplaced?
      - root_axis 9y ago
        On my part, I am going to end the discussion here since you appear to have ignored everything else I posted.
- deleted 9y ago
  [deleted]
lazerpants 9y ago
I'll outline the argument, and let you decide. (I made a lot of generalizations below regarding developing economies/countries, I'm sure I'm wrong in some cases, this is just what I know largely to be true) >Remember that in many of these countries, most people don't have smart phones, and there's a lot of people who don't even have phones. Depending on the country you're talking about, smartphone penetration for a lot of Africa is over 20% by population, increasing with increasing wealth or earnings. Cambodia, from your example, has about 50% smartphone penetration and 98% mobile phone penetration. >Electricity and internet connections are intermittent at best. Anecdotally, I can report that 3G coverage is ubiquitous in mid-size or larger population centers in Asia and Africa, even in very poor countries. In the countryside, it is hit or miss. >Good luck convincing Cambodian street hawkers that your magic internet money is better than a good old fashioned Greenback. I don't think small scale transactions are the use case for developing economy cryptocurrency utilization. Rather, the argument is that households may prefer an alternative to their local currency which allows them to hold liquid or semi-liquid savings. In developed economies we have bank accounts, stocks, bonds, CDs, and many other vehicles allowing for liquid store of value, and we (mostly) trust the government and banking system. In developing economies, lower and middle class households often have only cash vehicles. Some may have bank accounts, but those are subject to governmental whims (see India's disastrous surprise currency change last year) or currency volatility. When possible, many households will hold long-term savings in USD or EUR cash notes, as those are perceived as safe (wealthy households typically do the same, only by having a USD or EUR denominated bank account with a local or, preferably, international bank). Households save up local currency and then change it out for these high denomination USD/EUR cash notes with a bank or money changer. They would not go use $100 bills at the local market for groceries, they would change their currency back to local fiat if needed. Alternatively, they can sometimes transact large purchases with USD or EUR notes for things like computers, cars, property, and livestock. Essentially, the argument for cryptocurrency as a store of wealth in developing countries is: 1)households would prefer not to hold notes, as they are more easily lost or destroyed than a backup key would be 2)there are fewer transactions to deal with in exchanging currencies 3)remittances are easier and lower cost 4)holding high value notes only works for households of a certain wealth class, cryptocurrencies will allow lower income/wealth households to do what middle-lower income/wealth households are already doing

root_axis 9y ago

Indeed. It also requires considerable levels of technical literacy to use, maintain, and properly secure blockchain tokens, and even with all that people regularly have their bitcoins stolen or irreparably lost.

hanselot 9y ago
I love how Fiat Money was designed to be impossible to use for illegal purposes, and there is no way to steal it. I mean really, if there were a way for it to be used in that way, surely your argument would be pointless, but luckily we know that the more middlemen we introduce between us and another party, the more affordable the transaction will become.
- root_axis 9y ago
  > I love how Fiat Money was designed to be impossible to use for illegal purposes, and there is no way to steal it. So, I catch the meaning behind your sarcastic quip, but all you're doing here is offering up an absurd strawman. Obviously any currency can be stolen or used for illegal purposes, that's a willfully disingenuous interpretation of the argument because nobody has ever said that. This kind of reasoning would be like if someone said "the nature of dynamic typing makes the code prone to error" and you respond with "I love how strong static types were designed to make bugs impossible to produce, and there is no way it will cause the program to crash unexpectedly".
  - hanselot 9y ago
    > and even with all that people regularly have their bitcoins stolen or irreparably lost. > Obviously any currency can be stolen or used for illegal purposes So what is the purpose of your argument if all of that simply points out that any currency can be stolen or misplaced?
    - root_axis 9y ago
      On my part, I am going to end the discussion here since you appear to have ignored everything else I posted.
deleted 9y ago
[deleted]

lazerpants 9y ago

I'll outline the argument, and let you decide. (I made a lot of generalizations below regarding developing economies/countries, I'm sure I'm wrong in some cases, this is just what I know largely to be true) >Remember that in many of these countries, most people don't have smart phones, and there's a lot of people who don't even have phones. Depending on the country you're talking about, smartphone penetration for a lot of Africa is over 20% by population, increasing with increasing wealth or earnings. Cambodia, from your example, has about 50% smartphone penetration and 98% mobile phone penetration. >Electricity and internet connections are intermittent at best. Anecdotally, I can report that 3G coverage is ubiquitous in mid-size or larger population centers in Asia and Africa, even in very poor countries. In the countryside, it is hit or miss. >Good luck convincing Cambodian street hawkers that your magic internet money is better than a good old fashioned Greenback. I don't think small scale transactions are the use case for developing economy cryptocurrency utilization. Rather, the argument is that households may prefer an alternative to their local currency which allows them to hold liquid or semi-liquid savings. In developed economies we have bank accounts, stocks, bonds, CDs, and many other vehicles allowing for liquid store of value, and we (mostly) trust the government and banking system. In developing economies, lower and middle class households often have only cash vehicles. Some may have bank accounts, but those are subject to governmental whims (see India's disastrous surprise currency change last year) or currency volatility. When possible, many households will hold long-term savings in USD or EUR cash notes, as those are perceived as safe (wealthy households typically do the same, only by having a USD or EUR denominated bank account with a local or, preferably, international bank). Households save up local currency and then change it out for these high denomination USD/EUR cash notes with a bank or money changer. They would not go use $100 bills at the local market for groceries, they would change their currency back to local fiat if needed. Alternatively, they can sometimes transact large purchases with USD or EUR notes for things like computers, cars, property, and livestock. Essentially, the argument for cryptocurrency as a store of wealth in developing countries is: 1)households would prefer not to hold notes, as they are more easily lost or destroyed than a backup key would be 2)there are fewer transactions to deal with in exchanging currencies 3)remittances are easier and lower cost 4)holding high value notes only works for households of a certain wealth class, cryptocurrencies will allow lower income/wealth households to do what middle-lower income/wealth households are already doing