Earlier today Facebook popped the lid off of its cryptocurrency and digital wallet – Libra and Calibra respectively.
The announcement has already generated a large amount of chatter online with opinions being split as to whether it’s a good or bad idea.
That’s a discussion for another time though because today we’re taking a look at where Facebook’s coin could be most successful and Luno can help in that regard.
The firm recently conducted its Future of Money survey which polled 7 000 respondents in France, Indonesia, Italy, Malaysia, Nigeria, South Africa and the United Kingdom.
Initial findings from that survey reveal that Facebook might find Libra’s success in emerging markets.
“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,” general manager for Luno in Africa, Marius Reitz said of the findings.
Luno says that when asked whether a single global currency would make the current financial system worse or better, respondents in South Africa and Nigeria said it would make it better three times more than respondents in the UK.
In terms of what money is being used for, Luno found that in Nigeria when asked why money is important 60 percent said “to secure my family’s well being” compared to eight percent in the UK.
“It is very clear that if money is not simply a ‘nice to have’ and is vital for your future, then you spend more time understanding it, managing it, preserving it and to an extent being creative with how you maximise the use of it. Therefore if a cryptocurrency can provide a secure and cheaper means of exchanging value, better than the existing system, it will be used. This is why we believe that as new cryptocurrencies, linked to global brands are introduced they will find an important audience in emerging markets,” says Reitz.
To make a long story short, folks in emerging markets are often more financially savvy and looking to get a better control on their finances. Cryptocurrency that doesn’t rely on older and often more costly banking systems is an alluring prospect for many folks in emerging markets.
Will Libra and Calibra be successful? We have no idea but we’re now curious to see how well the currency performs in Africa and other emerging markets around the world.[Image – CC 0 Pixabay]