What we can learn from Asia’s domination of the crypto space
Asia’s drive to adopt, embrace and expand on the cryptocurrency revolution has attracted innovative businesses and venture capital to the continent, as robust optimism paves the way for total market domination.
As it stands now, there are primarily two approaches to cryptocurrencies: a more hesitant approach that can be seen by some countries, and a far more bullish, positive one, like that adopted by Japan and South Korea.
Indeed, these countries have absorbed the market without much real competition, but this period won’t last forever.
Once Facebook and Google inevitably roll back their ban on cryptocurrency advertisements, and financial institutions warm up further to this burgeoning industry, then it’s hard to see how this space will continue to thrive without rising internal competition.
In the past couple of years, South Korea and Japan have taken an independent approach in dealing with cryptocurrencies, which paints a very different picture regarding the front lines of crypto integration with mainstream institutions.
South Korea’s approach has consistently pointed toward integrating cryptocurrencies into its mainstream monetary system, partly through a series of privately funded applications endorsed and encouraged by the government.
The result is for users to be able to send and receive cryptocurrency the same way they can send and receive fiat money. And this is not something even remotely beyond the pale, as West-based applications are already hinting at making the same move and will eventually endeavor to add this when the demand is strong enough.
As we speak, South Korean firms are in the process of adding support for mainstream crypto assets such as Bitcoin and Ethereum, the latter of which processes more than half of all crypto-transactions.
As big businesses secure partnerships for the expected surges in cryptocurrency transactions, it won’t be at all surprising when Western firms and regulators realize this progressive potential and take the same route. And given the remarkable upswing that saw an additional US$20 billion pumped into the market on April 12, we can expect further adoption should this emergent bullish cycle continue.
In line with its global blockchain money-transfer plans, Ripple is expected to enter the Japanese mainstream monetary system officially in late 2018 or early next year.
According to Bloomberg, Ripple, a US digital payments company, is working with 61 Japanese banks on an application that will upgrade users’ experiences, enabling them to settle cash transfers instantly around the clock through an applied offshoot of blockchain technology.
Put simply, the traditional banking transfer system that requires multiple accounts in each country in order to function now has the Ripple network to contend with, which is making inroads as we speak.
On another Eastern front, many experts believe that China’s crackdown on cryptocurrency won’t last for long. It is argued that the second-largest economy in the world cannot afford to miss out on the major trends on which South Korea and Japan are now capitalizing.
Many say that Japan and South Korea helped fuel the much-publicized cryptocurrency surge in 2017 that saw Bitcoin reach the whopping price of more than $19,000.
At the same time, one cannot discount the positive sentiment that is emerging from Europe, the UK and the US, with the European Commission announcing its intention to invest more than €300 million (US$370 million) in cryptocurrency projects and start-ups in the second quarter of this year.
All things considered – including my own bullish crypto tendencies – we can clearly see that by and large, Asia has taken hold of the cryptocurrency reins, and should be seen as the current leader in this space – but for how long? Indeed, we have yet to see what a fully invested global push can do in this area, and I suspect the time for this is near at hand.