AAX-Forrester study shows bitcoin is taking root in emerging markets

abdelaziz Fathi

The crypto winter isn’t scaring emerging markets which seem to be setting the tone for the future adoption of bitcoin as legal tender despite the lack of a regulatory context.


Institutional cryptocurrency exchange AAX today revealed the findings of a new commissioned study conducted by Forrester Consulting. This research suggests that significant Bitcoin awareness and burgeoning adoption are underway in Africa, Latin America, the Middle East, and Southeast Asia.

The potential for cryptocurrency to lower transaction costs and increase financial inclusion has prompted consumers in developing countries to explore the digital asset for purposes beyond investment or speculation.

Forrester Consulting’s survey found 74% of consumers in the surveyed markets were aware of Bitcoin while 52% of respondents had noticed an increase in Bitcoin usage in their country over the past 12 months, from May 2021 to May 2022. Ninety-one percent of participants in the survey said they see a role for Bitcoin as enabling a digital future.

The findings indicate that despite its recent price volatility, Bitcoin use is likely to continue expanding in emerging markets. Data from the study points to a potential leap-frog effect occurring as emerging market users adopt Bitcoin for more daily transactions.

Although the possibility of displacing local currency with a highly-volatile alternative brings new risks, there were additional factors driving the use of Bitcoin in emerging markets. Namely, the list includes enabling consumers to become financially independent, particularly in countries with lower sovereign ratings, and dissatisfaction with existing financial services.

On top of that, the need for an additional means of making and receiving payments and transfers was a major trigger for crypto adoption as costs of sending and receiving remittances is relatively high, and banking spreads are wide. This has the potential to create a new type of banking system as Bitcoin offers a cross-border infrastructure to emerging market consumers that may be faster and more reliable than those available from local banks.

Indeed, the report noted that while developed markets remain conservative on the use of Bitcoin as a digital currency due to value, security, regulation, and sociopolitical concerns, consumers in emerging markets take a different perspective.

“For many users in emerging markets, Bitcoin offers an alternative to the banking system that is easier to access, more secure, and protected from government intervention,” said Ben Caselin, Head of Research and Strategy at AAX. “We believe this study really shows us the potential of Bitcoin to power a different, fairer, and more inclusive financial system for everyone – not simply an investment vehicle for institutions and a wealthy minority.”

“Bitcoin’s volatility might seem like an obstacle to widespread adoption in emerging markets, where financial resources are often limited,” Caselin added. “But adoption needs to be seen as taking place across a spectrum and in phases. Instead of making or taking payments in Bitcoin, this can mean using its infrastructure. The Lightning Network, which is a second layer on top of the Bitcoin network, is a good example. It facilitates Bitcoin micropayments quickly and cheaply and opens the possibility of using Bitcoin as a payment rail across other units of value – such as stablecoins. This allows emerging market users to benefit from Bitcoin’s security and privacy without having to be exposed to its volatility for savings and essential payments.”

The study marks a fresh iteration of AAX’s efforts to measure grassroots cryptocurrency adoption around the globe and offer unique insights after a year of increased attention for the industry.

AAX said last month it was expanding hiring right now, a sharp contrast to a slew of job cuts and a hiring freeze at multiple companies operating in the crypto space.

The prominent platform has “hundreds of roles” available across many functions as it double staff size this year to support its global expansion plans. AAX will open additional offices to support new markets and add staff to expand expertise and product lines.

The good news comes amid a downturn in crypto markets that triggered a wave of high-profile firings, layoffs, and staff reductions at leading players. On top of those pieces of news was Coinbase, which cut about 1,100 jobs or 18% of its workforce and Gemini which let 10% of its staff go.

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