Jerry Zhang

Impact of Cryptocurrency and Blockchain in Developing Countries: A Case Study of El Salvador

Started Apr. 21, 2022

Abstract or project description

The worsening economic situation in third world countries has contributed to rising wealth inequality, a decelerating infrastructure development, and aggravating political instability, stranding individuals in a poverty trap. A novel solution proposes developing cryptocurrencies, such as Bitcoin and Ethereum, and block chain technology which inherently could provide significant benefits by aiding economic growth and boosting financial access for individuals. However, the efficacy of cryptocurrencies is placed in question due to its volatile and stigmatized nature. This research paper will synthesize a conclusion from a variety of sources such as newspaper articles, academic journals, and governmental publications. A case study will be conducted on El Salvador, the first developing country to adopt Bitcoin as legal tender. Contrary to adversaries, we found that cryptocurrencies as a technological injection would in theory be effective in supporting economic growth and increasing financial access for individuals within third world countries. But when put into practice, its impact is uncertain.