Comment by SkyMarshal | Hacker News Reader

Comment by SkyMarshal | Hacker News Reader

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This and all other discussions of cryptocurrency being useful to the unbanked always fail to address the root of the problem - the unbanked don't have money. Get them steady reliable cash flow first, and bank accounts or other financial services will follow. Not vice versa.

Cryptocurrency won't help solve that root problem for poor people, only for VCs and technologists building themselves new money, exploiting the Cantillon Effect, and casting about for justifications to moon the market price.

To its credit this article came close to discussing this, it actually shows a chart comparing reasons why the unbanked don't have bank accounts. The main reason by far is, no money. But once that's established, then real question becomes - how do you solve that problem using cryptocurrency?

Nobody has an answer for that so they just conveniently skirt around it in these type of discussions.

I basically agree.

The point I wanted to make isn't that cryptocurrencies is a solution for all, or even most, of the unbanked. But it may be a solution for some of them. Most cite no money as the issue, but a whopping 40% didn't. Even if it's only applicable to 1% of all unbanked, that's still 17 million people who might benefit.

> Get them steady reliable cash flow first, and bank accounts or other financial services will follow.

For some, but not all. For instance giving them more money won't necessarily increase their trust in possibly corrupt banks. And it doesn't magically mean they'll get an account since they might still not have the required documentation.

>For instance giving them more money won't necessarily increase their trust in possibly corrupt banks.

Yes, hence why I said “bank accounts or other financial services”. The latter could be either centralized or decentralized. Either way, they still need cash flow/income first.

Of course they have money, just not a lot of it. They use cash and mobile credits, both of which have drawbacks like value fluctuation and the inability to accumulate savings. There's a good argument to be made that these populations stay in poverty, at least in part, because of a lack of access to banking.

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