Four crypto assets have had their value surge by more than 400% while significantly outmatching the flagship crypto asset, Bitcoin, amidst a relatively bullish trend in play.
CryptoDiffer, a crypto information company, disclosed such data on its Twitter feed.
Staking platform, Ramp Defi (RAMP), had rallied by more than 465% for the last month by January 15th, coupled with outperforming Bitcoin by 5 times.The crypto asset traded around $0.04 on December 16th before exploding to an all-time high of $0.28 on January 13th, according to Coinmarketcap.
The third crypto asset eclipsing Bitcoin in monthly returns is the blockchain transaction tracking protocol known as Parsiq (PRQ). PRQ had gained 414% in 30 days and exceeded BTC’s performance by 4.2 times.
The fourth digital currency is known as DeFiChain (DFI) printing gains of a 401% surge.
These transactions are executed using blockchains — eliminating the need for banks, who often slow payments down substantially.
Let’s imagine that you’re in Spain but want to send funds to Africa. The first step involves converting fiat currency into a digital asset of your choice. A wide range of websites and platforms exist that serve as an “on-ramp” — meaning purchases can be made using bank transfers and credit cards.
This cryptocurrency can be held in a secure wallet. When it’s time to make a transfer to your friends, they can give you the address for their wallet — comparable to the account number you’d get at an old-fashioned bank. These addresses can contain dozens of characters, so transcribing them carefully is crucial.
Once funds have arrived in an account, the recipient has several choices. They can either convert the crypto to fiat and withdraw it, or swap it for a less volatile digital asset such as a stablecoin.2.
What advantages does crypto offer over fiat?
It’s cheaper and faster… and could also help clamp down on money laundering.
There’s a lot of excitement surrounding how crypto could transform cross-border payments as we know it — making remittances, where workers in foreign countries send funds to their loved ones back home, much less expensive.
At present, the World Bank estimates that remittances sent through fiat channels result in average fees of 6.75%. For someone on a modest income, this can take a substantial chunk out of their earnings. Although this is less than the 9.67% charged in 2009, there’s still a long way to go. In the early 2010s, the G8 and the G20 set a target of slashing remittance costs to 5% — and the United Nations’ Sustainable Development Goals also set a target of 3% by 2030.
Cryptocurrencies could help these goals be realized much faster. According to figures from Deloitte, blockchain has the potential to reduce transaction costs by 40% to 80%. But the advantages may not end here. Currently, it can take three to five business days for funds to clear through old-fashioned wire networks — not ideal for someone who needs money in a hurry. But on certain blockchains, it’s possible for payments to be confirmed in seconds.
The advantages may not end here. As Deloitte notes, blockchain transactions can be data rich — meaning that metadata can be transmitted from end to end. All of this can help clamp down on money laundering and terrorist financing, two areas of concern for regulators. Many crypto platforms have introduced Know Your Customer checks to verify users, too.
One crucial benefit that cryptocurrencies can offer is unlocking access to financial services for the unbanked. Research suggests that 80% of consumers in sub-Saharan Africa fall into this category — and worldwide, a total of 1.7 billion people don’t have a bank account. There can be a multitude of reasons for this. Financial institutions may not operate in their geographic area, these services could be too expensive, or consumers may have a lack of trust.3.
How much money is sent around the world using crypto?
Digital assets have a modest market share of overall cross-border payments — but demand is growing.
According to Juniper Research, international digital remittances are set to surge to $525 billion by 2024… a 102% rise from where they were in 2019. This figure includes fintech platforms that solely deal in flat.
“Utilizing a blockchain-powered network, operators can offer their users a much faster, cheaper and more transparent service,” the authors said.
This view has been echoed by BlockData, which recently revealed that blockchain-based transactions are typically 388 times faster and 127 times cheaper than traditional remittances.
It’s a fast-moving industry, and it’s difficult to put an exact number on the volumes of cross-border payments made using crypto. However, figures from Clovr showed that 15% of those who made remittances from the U.S. in 2017 used a digital asset such as Bitcoin — making it more popular than prepaid cards, checks and cash. When it comes to business-to-business payments made via blockchain, this figure stood at $171 billion in 2019, but Juniper Research estimates that this will exceed $4.4 trillion in just four years’ time.4.
What are the downsides to using crypto?
The likes of Bitcoin often get criticized for being too volatile, and some say blockchain technology is too difficult for everyday consumers to understand.
It’s important to note that there’s one factor that will determine whether or not crypto-based cross-border payments are cheaper: the digital asset that’s being used.
Making transfers using Bitcoin and Ether can be expensive, especially during times of peak demand. Ethereum has been overwhelmed by transaction volumes on multiple occasions over the years — fueled by a rise in demand for collectible cats and decentralized finance. Addressing scalability concerns is going to be crucial if cryptocurrencies are going to be used more widely for remittances. Ripple, which doesn’t have a blockchain, offers solutions that are designed to make cross-border payments less expensive through the XRP asset. Several banks are already on board, and Ripple claims that it can process 50,000 transactions per second.
Crypto will only help to solve financial inclusion provided that those who stand to benefit most from remittances can be educated about how digital assets work, and have access to internet-enabled smartphones so they can access their funds. There are reasons to be optimistic here. As we mentioned earlier, 80% of consumers in sub-Saharan Africa are unbanked, yet 91% own a mobile phone — and smartphone adoption is rising. On the continent, mobile payments are also exceedingly popular, meaning that the leap to crypto-based transactions may not be a big one.
The final challenge concerns regulation. Industry executives have warned that more crypto regulation is coming, with the European Union recently announcing plans to comprehensively monitor the market in just four years’ time. This doesn’t necessarily mean that a ban on digital assets is on the horizon — indeed, many lawmakers have acknowledged that they can have advantages in reducing the costs associated with cross-border payments. As a result, some are exploring whether they should launch their own central bank digital currency.5.
How can you easily, securely store and exchange cryptocurrencies?
By using a platform that has a carefully cultivated reputation for keeping digital assets safe.
Crypto platforms are emerging that aim to make cross-border payments far less expensive than what many of us are accustomed to.
One of them is Changelly PRO. The company firmly believes that cryptocurrencies offer far greater levels of transparency than traditional financial institutions, and this will help instill confidence among consumers. Dozens of trading pairs are offered across the world’s biggest digital assets.
The platform is aiming to level the playing field by offering zero deposit fees, as well as competitive fees when funds are withdrawn from an account. This is coupled with an easy-to-use, intuitive interface — and 24/7 support for users around the world. Changelly PRO says its priority is making crypto simple, and offering cutting-edge solutions that beginner and professional traders alike will find advantageous.
Education is another area that Changelly PRO is hoping to address. To ensure that newcomers can get the most out of the service, in-depth learning materials cover everything from setting up an account to keeping it secure.
In September, the platform unveiled a brand-new iOS app for iPhones, giving users the freedom to complete transactions while on the move. This will also prove advantageous for those who don’t use a computer.
With demand for remittances unlikely to subside, crypto-focused platforms are likely to play an instrumental role in delivering a fairer deal for consumers. This could help inject some much-needed competition in the space, forcing traditional institutions to innovate.
Ray Hushpuppi and Mr. Woodbery converted millions of dollars into Bitcoin via Gemini exchange according to an FBI criminal complaint.
The two Nigerians jetsetters who filled their Instagram accounts with pictures of their ostentatious wealth were extradited from Dubai to the United States. According to the FBI, they were able to convert millions of dollars into Bitcoin (BTC) via the Gemini exchange.
Transaction summary for Bitcoin address 16AtGJbaxL2kmzx4mW5ocpT2ysTWxmacWn. Source: Crystal Blockchain
The two are Olalekan Jacob Ponle, also known as “Mr. Woodbery,” and “Mark Kain,” and Ramon Olorunwa Abbas, who used the aliases “Ray Hushpuppi” and “Hush”. The FBI complaint focused on the former’s activities and how he used Bitcoin to transfer the stolen funds.
Business email compromise — 1,500 BTC
According to the FBI, Ponle along with his accomplices was engaging in a scheme known as business email compromise or BEC. A criminal would gain access to a legitimate business email account and then manipulate the company’s employees into transferring company funds to the criminal’s bank account. The complaint alleges that Ponle and his accomplices defrauded American companies of tens of millions of dollars while converting $6.5 million into 1,500 BTC:
“Preliminary blockchain analysis indicates that PONLE received at least 1,494.71506296 bitcoin related to these BEC schemes, valued at approximately $6,599,499.98 at the time he received the proceeds.”
The complaint said it is clear that Ponle was not terribly concerned with covering his tracks on the Bitcoin network as he has been using the same address (16AtGJbaxL2kmzx4mW5ocpT2ysTWxmacWn) since 2014, though the complaint focuses on his illicit activity throughout 2019 only.
Gemini was the criminals’ favorite exchange. This may seem surprising, considering that the exchange is considered one of the most compliant in the industry. However, this choice can probably be explained by the fact the accused needed a U.S.-based exchange that caters to businesses.
On Feb. 15, 2019, Ponle’s associate confirmed that $2,149,000 had been successfully deposited to Gemini and converted to BTC.
A discussion between Ponle and his associate of the Feb. 15, 2019 transaction
These transactions, when traced on the Bitcoin blockchain, amounted to 340 and 261 BTC each, 601 BTC in total. At the time, Bitcoin price was at around $3,500.
Two Bitcoin transactions from Gemini exchange to Ponle’s address. Source: Crystal Blockchain
FBI Infiltrates Ponle’s Inner Circle
Another transaction took place on Jan. 17, 2019 when Ponle’s accomplice converted $119,000 into 33.13 BTC — in the FBI complaint, it mistakenly says 3.13 instead. This transaction originated from an unidentified address, but it is one hop away from another American exchange — Kraken. Although the latter is not mentioned in the complaint.
In July, the FBI was able to infiltrate Ponle’s inner circle when an agent began communicating with Ponle online using the same handle that was previously used by one of his associates. On Sept. 9, 2019, a discussion between Ponle and his associate about converting $5 million to Bitcoin took place.
A discussion between Ponle and his associate of the Sept. 9, 2019 transaction
Unbeknown to Ponle, this time it was an FBI agent at the other end of the chat. Although the complaint does not specify it, this transaction presumably never happened as no associated transaction can be identified with the “16AtGJ BTC Wallet.”
Cashing Out Via LocalBitcoin & Huobi
Whereas Gemini was the exchange of choice for converting stolen fiat into Bitcoin, LocalBitcoins and Huobi were preferable choices for cashing out. According to Crystal Blockchain, 577 BTC was cleared via the former and 539 BTC via the latter. Both have been criticized for lax KYC procedures in the past.
Ponle and his colleague Abbas lived a life of ostentatious wealth, parading their newly acquired fortunes on Instagram. In one of his last posts, Ponle admonished his followers against the guilt associated with wealth:
“YOU ARE WORTH THE PLEASURES OF YOUR LABOR 💙 Stop letting people make you feel guilty for the wealth you’ve acquired, especially when you paid in blood, sweat and tears, to have the things that are deemed “ un-purchase-able”.”
Regions of the world with fast-growing economic potential and young populations, such as India and Africa, will become leaders in crypto adoption
Beyond rapidly changing how we create, store and transfer value, cryptocurrencies are accelerating financial inclusion in a way that traditional financial institutions have either been unwilling or unable to. Yet crypto’s possibilities go way beyond banking the unbanked. It allows developing nations and those without access to financial services to avoid the bank completely and transact and grow small businesses using just a mobile phone.
Why financial inclusion is so important
Even today, almost 2 billion people around the world have no access to financial services. That’s approximately one-fourth of the global population. Having nowhere to place savings and not being able to get a bank card, obtain credit or avail of basic services such as life insurance is a horribly crippling disadvantage. These people are effectively unable to take part in their local economies — at least, in meaningful ways.
Gaining access to financial services will allow financially excluded people to improve their lives, increase their earnings, raise their household income and even stash away some savings for troubled times such as the ones we’re living in currently. Entrepreneurs can gain access to credit to start a business and families can acquire land and livestock and ensure that the roofs over their heads are safe. Quality of life can be improved for all.
Further still, impoverished parents can begin to send their children to school, offer them improved living conditions and access healthcare services. Financial inclusion can even lead to the creation of jobs as small businesses expand and need to take on additional personnel. We’re talking about a massive section of the global population that could substantially motor the economy through financial inclusion.
Developing countries are home to a young, tech-savvy population
The vast majority of financially excluded individuals live in developing regions. Yet this also coincides with a young, largely tech-savvy population. In parts of Africa, for example, mobile phones are more common than access to electricity. They have long been used as a primary tool for daily life exchanges and, more recently, for cryptocurrency use.
Across Africa, some 200 million people are between the ages of 15 and 24. This makes them generally well-versed in technology and a naturally captive audience for cryptocurrency adoption. This is mirrored by the population in many developing countries including Indonesia, Turkey and India. A tech-savvy population with a high mobile phone penetration rate — and a pressing need for financial services: This creates the perfect conditions to accelerate the adoption of cryptocurrencies.
As many people can’t access the traditional banking system, being able to earn, save and transact in cryptocurrencies directly from a telephone is hugely beneficial.
India’s national currency, the rupee, has steadily declined in value against the United States dollar over the last decade. And with the COVID-19 pandemic causing increased money printing in India just as in other parts of the world, the rupee is being devalued further. Declining confidence in the national fiat currency as well as the government could be a large catalyst for cryptocurrency adoption in India and in many parts of the world.
Along with Africa and Indonesia, India’s population is young and very familiar with technology. In fact, around 8% of India’s gross domestic product comes from its well-developed IT outsourcing industry. The country has the skills and technical talent to make crypto startups flourish here. And with the largest remittance market in the world, crypto is the perfect use case for unshackling people from the high fees and lengthy delays involved in sending money home.
Onboarding the next wave to crypto
Of course, the right conditions and the potential don’t make crypto adoption a done deal. There is still much work to be done. The scene is being set for more and more crypto startups, remittance companies, exchanges and applications to appear across the developing region. At OKEx, we see the giant potential for crypto adoption in these parts of the world, and we want to be at the forefront of it. This is why our partnership with Paxful, the leading peer-to-peer Bitcoin (BTC) marketplace, is all the more significant.
Paxful has an extensive payment method infrastructure that allows local people to select how they pay for their Bitcoin from more than 300 different ways. This could be gift cards, store points, cash on delivery — or indeed any local method deemed acceptable by the seller. This kind of flexibility allows it to onboard people into cryptocurrency more easily.
They can then send and receive Bitcoin for goods and services and, through OKEx, earn interest on their BTC savings through high-interest accounts as well as make their money work for them accessing advanced trading tools.
As regulation becomes more favorable and the people’s needs are still repeatedly ignored by traditional finance, a young population with high mobile penetration will help financial inclusion to finally become a reality. The next wave will soon be onboarded to crypto, and it’s the developing world that will be leading the charge.
The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cryptopayplus LTD
After seeing an abject failure of traditional financial models, people might turn to decentralized peer-to-peer technology with crypto as the future.
Plenty of injustice plagues our communities.
For instance, in our world, the unbanked and underbanked don’t have easy access to financial knowledge. All too often, that is reserved for people with wealth and opportunity. If you don’t have these resources shown or taught to you by a professional, you might not have adequate access to the necessary information for gaining financial literacy.
Such education often only comes as income increases. So, how might we increase the
income of the unbanked so as to arm them with more knowledge? Many of those at lower socioeconomic levels don’t know what Bitcoin (BTC) is. That knowledge has not matriculated down from the crypto gurus or the finance experts to some of the less privileged economic classes.
The unbanked can be shielded from the ways in which our financial system is wildly unsustainable and plagued with inflation and debt. Money these days is just created “out of thin air” with no inherent value backing this paper currency. The media can sometimes articulate plainly how we have a fundamentally flawed financial system, but often dismisses the specifics that would arm people with more knowledge to navigate this ecosystem.
Bitcoin is the start of a plan to correct this fundamentally corrupt and unsustainable financial culture. Bitcoin represents an idea. A use case. A first pass at evolving a broken system. Bitcoin is a place where every human and every person becomes equal.
When you’re transacting with Bitcoin, your wallets are encrypted, as is your identity. No one knows who you are or how much money you have. There’s no space for prejudice, division or negative treatment. In such a financial utopia, we are not defined by what we look like, what we say, how we talk or how we may be different.
We as a society have a long way to go before implementing such an idea. We need to teach and reinforce why it’s beneficial to invest and save for the future. Or to seek a special tool and round spare change from everyday purchases into Bitcoin for the future, using a dollar-cost averaging strategy to mitigate volatility in a very high-fluctuating but high-reward asset.
In short, the concept of how a little bit of money can compound into a large windfall should be ingrained in our idea of finance. This concept has typically been reserved to the financially privileged. Many people that come from wealthy backgrounds are taught very early on to save money, invest and to build for their future — they’re taught to to use their money and make more money.
But many other communities lack that type of discipline or think they need thousands of dollars to get started. The result of this dichotomy is that 40% of Americans can’t afford an unexpected $400 expense. That means, if 40% of people were to blow two tires on their car, they all either can’t afford it or run out of money covering that expense.
The way to force change on this current topic of inequality and injustice is to empower people with knowledge and easy-to-use tools that assist in investing and saving. When it comes to financial literacy, this includes educating the unbanked about technology like crypto.
Nature adapts and evolves — so should we. We needed to recognize that this is a problem, and we have. The first step to solving any problem is admitting there is one. Now that we have, what can we do to change it? How can we adapt ourselves and our mindset, and change our outlook?
People are pondering different solutions, because the majority — or at least a growing number of people — are finding that the current solution doesn’t work for them. Inflation and debt are immense pain points in our system. Money being created out of thin air and backed by nothing isn’t sustainable.
That’s where the real innovators come in. Bitcoin represents the culmination of a group of people coming together and asking, “How can we improve this?” That’s how humans evolve. That’s how our financial system should evolve: by coming together and asking the question, “What can we do better?”