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FinTech is an umbrella term for all advanced software technologies designed to improve access to and use of financial services by businesses and individuals. industry has a market valuation of over $330 billion and is expected to grow nearly 20% over the next six years. Cryptocurrency, with its backbone technology and blockchain, falls under FinTech, creating and revolutionizing a whole new sector of digital finance. For example, FTX and Circle are among the fastest growing FinTech companies that secured Funding rounds of $1.8 billion and $1.5 billion in 2022.
FinTech companies are growing, and so is the number of crypto users. About 300 million people in 2022 use cryptocurrency – almost 4% of the world’s population. While cryptocurrencies have become more popular due to the rise of DeFi, its level of adoption indicates that most non-crypto users avoid participating due to a lack of knowledge regarding the technology. Crypto-assets and blockchains seem complex at first sight and, therefore, difficult to understand for ordinary mortals. Given this, people might as well stick with fiat and stop looking at digital assets.
This is where the crypto education provided by market participants comes into play. The most significant benefits of providing the general population with detailed, easy-to-digest, and high-quality crypto education can be summarized as follows.
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Crypto Education Facilitates a More Open and Inclusive FinTech Industry
By making crypto education accessible to non-crypto users, the general public will feel more comfortable using cryptocurrencies in one way or another, whether it’s transacting or invest in it or start their crypto-related businesses and start-ups. Education is key to reducing volatility over time because more people can counter price volatility and swings. Moreover, education makes people better prepared for the panic caused by crypto price movements.
However, it is not only about the financial aspects. blockchain has many use cases outside of crypto, including implementing smart contracts and securing personal access to credentials. By learning how blockchain works and receiving the right guidance from an expert, the average person can integrate this technology into their business, regardless of the industry – healthcare, travel, education, insurance, education, etc. The growth of the FinTech industry is directly correlated to the advancement of the general population in understanding the benefits and limitations of crypto.
Crypto education raises awareness of crypto scams
The current market in 2021 has also set the stage for scammers trying to trick innocent people into exploring the crypto industry. Over a billion dollars have been Fly in crypto scams – around one in four reported lost, more than any other payment method.
The best way to fight scammers and spot red flag projects is to understand how they work to protect you on a higher level. For example, newcomers should learn to identify a project with ponzinomic models — multi-level marketing systems – to protect and never give their private keys and seed phrases to anyone. It is essential to teach the general public to avoid worthless tokens from projects that do not provide a useful financial solution or service and are more like a trendy marketing strategy.
Crypto Education Benefits Third World Countries
Not everyone can open a bank account – and if you’re a low-income person, it’s worse. This fact reverberates more in third world countries. But with an internet connection, people without a bank can create digital wallets on their phones or computers and start transacting cryptocurrencies with individuals around the world.
Some people decide to trade crypto-to-fiat and fiat-to-crypto on peer-to-peer marketplaces, allowing users to exchange their local currency for US-pegged crypto or stablecoins and protect themselves from currency devaluation .
In Latin America and other developing countries, many families depend on remittances sent by family members working in first world countries. It’s quite expensive to do this with traditional platforms like Western Union, but this is where crypto and blockchain can provide cheaper transaction fees and faster settlement times. Only a wallet address is needed to receive the funds.
Advanced blockchain can also act as a great enabler of educational opportunities in developing countries, thanks to the open source nature of the technology. It is equally crucial for crypto whales and blockchain startups to research potential investment opportunities and initiate mass blockchain adoption using the same tools for educational purposes.
Related: How Electroneum Can Help Empower the Unbanked and Those Living in Poverty in Developing Countries
Why Crypto Institutions Should Care About Educating People
Demand and institutional interest in cryptocurrencies exist – but many industry players have invested in them while neglecting the importance of providing the average user with an easy way to understand the crypto ecosystem. Crypto education initiatives and mass adoption depend directly on crypto institutions and entrepreneurs. It is not enough to develop a financial project or service, you must first and foremost teach people how to use it. Unfortunately, digital tools and the ability to use blockchain technologies are now only accessible to a tiny percentage of the population.
By providing a better educational path for newcomers, they could become more interested in the world of FinTech. Therefore, more people can join the industry by building relationships, businesses, or investing – anything, and the idea is to make FinTech more accessible to the masses.