Singapore-based Huobi cryptocurrency exchange is planning to expand operations to Middle Eastern, African and South Asian according to an announcement made at the World Blockchain Summit in Dubai this week.
According to the new announcement, the company wants to provide digital asset trading services for the unbanked and underbanked in these regions.
The company is starting with a MENA head office that is based in Dubai, which is currently "leading the blockchain effort in the region" according to Huobi co-founder Mohit Davar who made the announcement at the summit. The Dubai office will replicate the company's ecosystem model in the MENA region. It will thus offer OTC trading, token-to-token trading, Blockchain project incubation, community development and an educational center.
Currently, the company is already operating an online trading platform to serve the region and is currently in the process of establishing important partnerships with various players in these regions. This is starting with AI traders who will offer artificial intelligence based digital asset trading solutions. Huobi has been expanding operations this year including in Europe and Asia markets.
Regions to experience growth in crypto-related businesses
These regions are leading a boom in growth of global non-cash transactions according to a recent report by French banking group BNB Paribas and IT company Capgemini. The report says that there was a sharp growth in digital transactions and payments around the world, which rose 10.1 percent to 482.6 billion at the end of 2016. It says that although developing worlds hold a market of around 33 percent, they will overtake mature markets to account for more than half of non-cash transactions by 2021. Russia is leading the growth at 36.5 percent, India at 33.2 percent and China at 25.8 percent as notable movers in the 2015-16 period.
It also says that developing markets will record a growth of 21.6 percent in digital non-cash transactions led by Asia at 28.8 percent over the next five years.
To cement the report, meanwhile, MarketsandMarkets has released a report saying that cryptocurrency market will grow to $1.4 billion by 2024 and that it will benefit developing economies the most. The report says that the Asia Pacific region will experience a growth of 25 percent while the rest of the world including Africa will experience a 5 percent growth by 2024. North America will still be leading at 40 percent followed by Europe at 30 percent.
Another report from the Transparency Market Research (TMR) released this week said that aggregated blockchain markets will reach US$20 billion by 2024 hence growing at a CAGR of 58.90% during 2016 – 2024.
That said, it will be uncommon for these regions to attract increased investments from crypto and blockchain businesses and in related tech. And they have been doing that given that the technology better helps with financial inclusivity for underbanked and unbanked populations. They will certainly face competition from the legacy payment platforms which are also targeting these regions with aggressive products.
The report by French banking group BNB Paribas and IT company Capgemini said that non-cash transactions and payment tech can help address problems in the developing worlds such as corruption given that non-cash transactions share a positive linear correlation with corruption perception index. The report also indicated that South Africa is leading Africa continent with development of blockchain and crypto tech.
Asia, UK, Australia, and US are all common for crypto businesses and while regions such as Africa are largely uncommon grounds for cryptocurrency businesses, a lot is happening about it. Huobi will not be the first to venture in the region. Apart from the exchanges based in Africa such as very well known Zimbabwe-based Golix which is also entering Kenya and Uganda, Binance also recently established a fiat crypto exchange in Uganda known as Binance in a country where only 33 percent actively use their registered financial accounts in 2016 according to Financial Inclusion Insights. There are a number of other crypto exchanges, but all in all very few, in these regions.
Ripple, which is more of addressed to institutional players such as banks, recently announced plans to venture into the continent through Flutterwave that aims to provide a unified payment solution for the whole African. And it is on the ground because it now has more than 50 African banks as partners processing payments on its blockchain.
Flutterwave will now be using Ripple Net following this development -- Ripple Net is designed to transfer money internationally quickly, safely and incredibly cheaply. In particular, Flutterwave will be using xCurrent, which aims at helping banks, remittance services, and financial institutions to perform international payments.
There are many projects across the world that are trying to provide cross-border payments cheaper for the vast unbanked populations in developing worlds, and it is expected that these will continue becoming popular in these economies.