Economy

A Birds-Eye Look At The Global Cryptocurrency Revolution

A Birds-Eye Look At The Global Cryptocurrency Revolution

A local El Salvadoran business that accepts bitcoin as a payment method

Hannah Steinkopf-Frank

The products originally of America's tech industry, Bitcoin and other digital currencies have since been adopted around the world. Nigeria, Vietnam and the Philippines now have some of the highest rates of cryptocurrency use, and many local entrepreneurs and governments are trying to cash in by building their own domestic coins.

Not all of these attempts have been successful. But some are providing innovative solutions to adapt to specific needs and forge local competitors in the global economic marketplace. From Cambodia to El Salvador, here are five examples of where crypto could prove to be the currency of the future.

Africa

In 2018, Afro was created with the goal of becoming Africa's first cryptocurrency, with founders that include lawyers, tech experts and artists. While Afro has only signed a treaty with one African country, Côte d'Ivoire, it now boasts 10,000 transactions a year. And there are other African cryptos looking to gain ground across the continent, including NuruCoin and Akoin (yes the coin of Senegalese-American singer Akon).

  • Fondation Afro is currently in talks with central banks in countries including Benin, Burundi, Cameroon and Tanzania. The absence of clear regulations, together with fears around the instability of crypto has slowed its development. And yet, unlike in the rest of the world, small commerce, rather than financial traders, has led much of cryptocurrency's growth in Africa. As David Nataf, the co-founder of Fondation Afro, tells Jeune Afrique, "We are laying the foundations. It's a bit like when the internet started out, it's brand new."
  • Afro has set its sights on Nigeria, Rwanda and South Africa, where large populations might be interested in a currency that more easily facilitates remittances, an important component of many African economies. Cryptocurrencies can speed up transfers and lower transaction costs. Exchanges can be conducted with just a smartphone, which is significant given that they are the main (if not only way) many across the continent access the internet.
  • Fears of pirarcy persist — note the case of the two South African brothers who disappeared with $3.6 billion from their crypto investment platform. But technology like Afro could potentially help the 80% of Africans who don't have bank accounts "leapfrog" in terms of development by going past traditional monetary systems.

Asia

With some of the world's most advanced digital currencies, many Asian countries are looking at how technology can fortify existing currencies and payment systems. These central bank digital currencies (CBDCs) provide a more formalized (and potentially stable) way for paperless transactions, but also raise fears around government surveillance.

  • In October 2020, Cambodia launched a blockchain-based mobile payment system called Bakong, named after the Angkor Wat temple. The digital wallet facilitates payments with QR codes and even works for those without bank accounts. Serey Chea, managing director of the National Bank of Cambodia, tells Le Monde, "Our goal is for this platform to help strengthen financial inclusion and reduce social inequalities, as very few people have a bank account in the countryside [more than 75% of the population lives in rural areas]."
  • When it comes to the world's second largest economy (and the place that invented paper money), China is hoping its e-yuan can be a powerful competitor to Bitcoin. China has already cracked down on cryptocurrency mining and the e-yuan is a departure from the governmentless cryptocurrencies that aren't bound to local laws or monitoring — essentially eliminating the anonymity of crypto purchases. In October 2020, a test run of 10-million e-yuan was given to 50,000 Shenzhen residents to spend in 3,300 partner shops. Since then, 200-million e-yuan have been distributed.
  • Elsewhere, the Philippines has approved 17 cryptocurrency exchanges and, similar to many African countries, many are focusing on facilitating remittances. Satoshi Citadel Industries created its remittance unit Rebit to support the some 2.3 million Filipinos working abroad sending billions of dollars of money back home each year. Given that the Philippines and many other developing economies still have smaller demands for Bitcoin, the returns can end up being greater than the invested amounts.

Latin America

Amidst economic turmoil caused by the pandemic and widespread inflation, many Latin American countries are exploring the potential of cryptocurrencies for more durable development. Politicians from Paraguay to Mexico have even taken part in the "laser eye" meme to express their support of this technology.

  • In June 2021, El Salvador became the first country in the world to adopt Bitcoin as its legal tender. The goal is to help the struggling Central American country (which has experienced low GDP growth) through modernization and digitalization. President Nayib Bukele — the man behind the "Bitcoin law" — says he hopes El Salvador will become a hotspot for Bitcoin mining, supported by its vast geothermal resources. The government is even offering $30 in Bitcoin to any citizen who starts using its new crypto wallet, Chivo.
  • El Salvador is not alone in the craze, with many of the region's largest economies leading the charge: In Brazil, the Mercado Bitcoin exchange traded $5 billion in the first quarter of 2021, and the Bitso (Mexico) and Ripio (Argentina) exchanges are also expanding. Brazil also announced early this year that it's launching a Central Bank Digital Currency.
  • On a broader level, Latam Coin Protocol is hoping to improve the regional economic outlook with its Latam Coin. More than just a cryptocurrency, Latin Coin Protocol also includes a charity with the goal of social and productive development. Given that Latam Coin launched just this past June, it's too early to tell if it will prove to be a powerful crypto player.
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Society

The Food Truck, A Sign That The White And Wealthy Are Moving In

In San Diego, California, a researcher tracked how in the city's low-income neighborhoods that have traditionally lacked dining options, when interesting eateries arrive the gentrification of white, affluent and college-educated people has begun.

Balboa Park Spring Fling Food Truck festival

San Diego Food Trucks via Facebook
Pascale Joassart-Marcelli

SAN DIEGO — Everybody, it seems, welcomes the arrival of new restaurants, cafés, food trucks and farmers markets.

What could be the downside of fresh veggies, homemade empanadas and a pop-up restaurant specializing in banh mis?

But when they appear in unexpected places – think inner-city areas populated by immigrants – they're often the first salvo in a broader effort to rebrand and remake the community. As a result, these neighborhoods can quickly become unaffordable and unrecognizable to longtime residents.

An appetite for gentrification

I live in San Diego, where I teach courses on urban and food geographies and conduct research on the relationship between food and ethnicity in urban contexts.

In recent years, I started to notice a pattern playing out in the city's low-income neighborhoods that have traditionally lacked food options. More ethnic restaurants, street vendors, community gardens and farmers markets were cropping up. These, in turn, spurred growing numbers of white, affluent and college-educated people to venture into areas they had long avoided.

This observation inspired me to write a book, titled The $16 Taco, about how food – including what's seen as "ethnic," "authentic" or "alternative" – often serves as a spearhead for gentrification.

Take City Heights, a large multi-ethnic San Diego neighborhood where successive waves of refugees from places as far away as Vietnam and Somalia have resettled. In 2016, a dusty vacant lot on the busiest boulevard was converted into an outdoor international marketplace called Fair@44. There, food vendors gather in semi-permanent stalls to sell pupusas, lechon (roasted pig), single-sourced cold-brewed coffee, cupcakes and tamarind raspado (crushed ice) to neighborhood residents, along with tourists and visitors from other parts of the city.

Informal street vendors are casualties.

A public-private partnership called the City Heights Community Development Corporation, together with several nonprofits, launched the initiative to increase "access to healthy and culturally appropriate food" and serve as "a business incubator for local micro-entrepreneurs," including immigrants and refugees who live in the neighborhood.

On paper, this all sounds great.

But just a few blocks outside the gates, informal street vendors – who have long sold goods such as fruit, tamales and ice cream to residents who can't easily access supermarkets – now face heightened harassment. They've become causalities in a citywide crackdown on sidewalk vending spurred by complaints from business owners and residents in more affluent areas.

This isn't just happening in San Diego. The same tensions have been playing out in rapidly gentrifying areas like Los Angeles' Boyle Heights neighborhood, Chicago's Pilsen neighborhood, New York's Queens borough and East Austin, Texas.

In all of these places, because "ethnic," "authentic" and "exotic" foods are seen as cultural assets, they've become magnets for development.

Food vendor at outdoor international marketplace called Fair@44.

Fairat44 via Instagram

A call for food justice

Cities and neighborhoods have long sought to attract educated and affluent residents – people whom sociologist Richard Florida dubbed "the creative class." The thinking goes that these newcomers will spend their dollars and presumably contribute to economic growth and job creation.

Food, it seems, has become the perfect lure.

It's uncontroversial and has broad appeal. It taps into the American Dream and appeals to the multicultural values of many educated, wealthy foodies. Small food businesses, with their relatively low cost of entry, have been a cornerstone of ethnic entrepreneurship in American cities. And initiatives like farmers markets and street fairs don't require much in the way of public investment; instead, they rely on entrepreneurs and community-based organizations to do the heavy lifting.

In City Heights, the Community Development Corporation hosted its first annual City Heights Street Food Festival in 2019 to "get people together around table and food stalls to celebrate another year of community building." Other recent events have included African Restaurant Week, Dia de Los Muertos, New Year Lunar Festival, Soul Food Fest and Brazilian Carnival, all of which rely on food and drink to attract visitors and support local businesses.

Meanwhile, initiatives such as the New Roots Community Farm and the City Heights Farmers' Market have been launched by nonprofits with philanthropic support in the name of "food justice," with the goal of reducing racial disparities in access to healthy food and empowering residents – projects that are particularly appealing to highly educated people who value diversity and democracy.

Upending an existing foodscape

In media coverage of changing foodscapes in low-income neighborhoods like City Heights, you'll rarely find any complaints.

San Diego Magazine's neighborhood guide for City Heights, for example, emphasizes its "claim to authentic international eats, along with live music venues, craft beer, coffee, and outdoor fun." It recommends several ethnic restaurants and warns readers not to be fooled by appearances.

Longtime residents find themselves forced to compete against the "urban food machine"

But that doesn't mean objections don't exist.

Many longtime residents and small-business owners – mostly people of color and immigrants – have, for decades, lived, worked and struggled to feed their families in these neighborhoods. To do so, they've run convenience stores, opened ethnic restaurants, sold food in parks and alleys and created spaces to grow their own food.

All represent strategies to meet community needs in a place mostly ignored by mainstream retailers.

So what happens when new competitors come to town?

Food vendor at outdoor international marketplace called Fair@44.

Fairat44 via Instagram

Starting at a disadvantage

As I document in my book, these ethnic food businesses, because of a lack of financial and technical support, often struggle to compete with new enterprises that feature fresh façades, celebrity chefs, flashy marketing, bogus claims of authenticity and disproportionate media attention. Furthermore, following the arrival of more-affluent residents, existing ones find it increasingly difficult to stay.

My analysis of real estate ads for properties listed in City Heights and other gentrifying San Diego neighborhoods found that access to restaurants, cafés, farmers markets and outdoor dining is a common selling point. The listings I studied from 2019 often enticed potential buyers with lines like "shop at the local farmers' market," "join food truck festivals" and "participate in community food drives!"

San Diego Magazine's home buyer guide for the same year identified City Heights as an "up-and-coming neighborhood," attributing its appeal to its diverse population and eclectic "culinary landscape," including several restaurants and Fair@44.

When I see that City Heights' home prices rose 58% over the past three years, I'm not surprised.

Going up against the urban food machine

Longtime residents find themselves forced to compete against what I call the "urban food machine," a play on sociologist Harvey Molotch's "urban growth machine" – a term he coined more than 50 years ago to explain how cities were being shaped by a loose coalition of powerful elites who sought to profit off urban growth.

I argue that investors and developers use food as a tool for achieving the same ends.

When their work is done, what's left is a rather insipid and tasteless neighborhood, where foodscapes become more of a marketable mishmash of cultures than an ethnic enclave that's evolved organically to meet the needs of residents. The distinctions of time and place start to blur: An "ethnic food district" in San Diego looks no different than one in Chicago or Austin.

Meanwhile, the routines and rhythms of everyday life have changed so much that longtime residents no longer feel like they belong. Their stories and culture reduced to a selling point, they're forced to either recede to the shadows or leave altogether.

It's hard to see how that's a form of inclusion or empowerment.The Conversation

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Pascale Joassart-Marcelli is a Professor of Geography and Director, Urban Studies and Food Studies Programs at San Diego State University

This article is republished from The Conversation under a Creative Commons license. Read the original article.


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