Marc Faber on Bitcoin: Unbanked Developing World Not Ready for Bitcoin

[kekky]

In our latest Squawkonomics interview, we asked Marc Faber about Bitcoin and its uses in developing markets across the world. One of the things he said: ""If someone tells me, Oh, in Cambodia or in India, only 10% of people have a bank account, then I would assume these people are not capable to transact in an encrypted currency""

Check out the full 4 minutes where Marc Faber talks Bitcoin IPOs in Cambodia, India, and more at https://www.youtube.com/watch?v=_5YwtyDZ0jU

[bitrider]

I believe he is completely wrong about this. Confused and uninformed. Experience in Africa with cell phone based payment systems has been massive success. Adoption to un-banked has been phenomenal and ubiquitous. Bitcoin based systems will be instantly superior in almost every way - including cost, cross-national application, value store, etc. Just need the tools - which are coming quickly.

[kekky]

Perhaps David Moskowitz of Coin Republic does have the right idea on this one. We did an interview with him right before we met with Marc, and you can clearly see that David and Marc are at opposing ends of this debate. You can check it out at https://www.youtube.com/watch?v=sH68CWjN-lQ if you like.

[David-M]

Some Facts about Cambodia:
15 million people
18 million mobile subscribers
yes, 118% penetration! (multiple phones per user)

They can leapfrog the existing banking system.

David

[bitrider]

Exactly. And much of the developing world (with billions and billions of un-banked) looks like that.   

[Mudd]

I believe he is completely wrong about this. Confused and uninformed. Experience in Africa with cell phone based payment systems has been massive success. Adoption to un-banked has been phenomenal and ubiquitous. Bitcoin based systems will be instantly superior in almost every way - including cost, cross-national application, value store, etc. Just need the tools - which are coming quickly.

I agree with you. I think bitcoin adoption may be slow there at first but it will soon pick up. The mobile banking market is massive there and bitcoin can further help.

[Ron~Popeil]

This more than an economic issue, this is a moral one. Giving these people access to capital and a world market is simply the right thing to do.

[waldox]

most in the third world dont know about bitcoin yet
once they do they will start joining up

[tinof]

Bitcoin still have high dependency on the traditional bank system.

In this regard, he is right that people with no bank account will not see it as favorable alternative to local currency.

[waldox]

with bitcoin 100% in cambodia/india/africa can have a bank account!

[Pente]

Some Facts about Cambodia:
15 million people
18 million mobile subscribers
yes, 118% penetration! (multiple phones per user)

They can leapfrog the existing banking system.

David

My youngest wife in Kenya uses 3 cell phones. One receives calls for free, one makes phone calls for next to free, the other does text messages for basically free. She works in marketing doing cold sales calls and I know her boss helps pay for them.

When I was on the matatu (type of bus) into downtown Nairobi in the early morning, it was filled with young professionals. They were all playing with Androids and various tablets.

Most people don't realize how technology is leapfrogging in 3rd world countries. They are skipping the land lines. Phone and internet run off microtransactions. For instance, you can rent 3G Orange by the day. It is about 40 shillings ($.50) for about 3-6 MB/second download speed depending on the time of day. There are internet cafes everywhere for about $0.25 per hour.

Young professionals using these devices earn about $250 per month compared to typical salaries of less than $100 per month.

MPESA is already very popular in many African nations, but it is centralized, and governments keep raising the taxes on using it. I believe at some point this cause a huge shift to cryptocurrencies.

 

[bitrider]

Exactly. This is the reality on the ground throughout the developing world. The infrastructure is not there yet for bitcoin, but it is on the way. And it will explode...unless it does not. 

[Este Nuno]

Bitcoin has a long way to go to ever be usable in Cambodia. It's not nearly user friendly enough and the risk of theft or loss is simply too high for the average person. It would take a full service company like Circle to build the infrastructure and support network required to enable adoption. The company would in effect have to operate like a bank initially, safeguarding people's funds until the market is mature enough to secure itself.

[okthen]

The developing world isn't ready for bitcoin not because it is unbanked. It just doesn't have enough technology widespread. Everyone has to have a computer to start with...

[Este Nuno]

The developing world isn't ready for bitcoin not because it is unbanked. It just doesn't have enough technology widespread. Everyone has to have a computer to start with...

Actually I think the mobile phone penetration is sufficient. All these modern phones are effectively computers. A lot of these new phones are better than my laptop. I don't think that's an issue as much as the safety of using bitcoin. As well as the volatility.

[bryant.coleman]

Forget about the developing world. Even the vast majority of the people in the developed world won't be able to use bitcoins, unless they are made simpler, so that the non-tech savvy population will also be able to use them.

[OROBTC]

...

I am down here in Peru on a visit (and a little business) and hardly anyone has heard of Bitcoin.  Just one guy, who runs a money-changing store (dollars or euros to Peruvian Soles and back).  He was not the least bit interested in the whole BTC idea.

Not even a MoneyGram guy at a fancy mall here in Lima had heard of it.

It will take a while here in Peru.

***

I have heard from two people that BTC IS taking off in Argentina (because of gross financial mismanagement by their .gov).  So, maybe it will happen faster than I think now.

[transient858]

Forget about the developing world. Even the vast majority of the people in the developed world won't be able to use bitcoins, unless they are made simpler, so that the non-tech savvy population will also be able to use them.

Thought most of the developed world are tech savy?

[Bubbles06]

Forget about the developing world. Even the vast majority of the people in the developed world won't be able to use bitcoins, unless they are made simpler, so that the non-tech savvy population will also be able to use them.

Thought most of the developed world are tech savy?

No, most people are definitely not tech savvy.

[Ron~Popeil]

Even the most recalcitrant technophobes usually catch on. Who would have thought you would see 90 year olds talking on cell phones? There will also be companies that can make money by facilitating BTC use by people that aren't tech savvy. This is kind of a non issue.