[OPINION] Can the PH be a crypto country?
The recent announcement for the creation of a “Crypto Valley of Asia” (CVA) in Cagayan was welcome news for any Filipino who wants to see wider use of cryptocurrency, blockchain, and other fin-tech in the country. With 25 international crypto and fin-tech companies set to locate there when the hub rolls out over three phases in the next ten years, these ventures will drive the adoption of digital currencies in the area.
But the CVA is only the first step. To use an analogy, look at Silicon Valley. It's the mecca of all tech, gathering many of the world’s best engineers, entrepreneurs, and investors into a geographic area that's relatively small in the context of the United States. But even with the emergence of this world-class tech hub, public and private leaders in the United States did not exactly call it a day. Instead, they took pains to encourage tech entrepreneurship across the country, at both the state and city level, through countless programs, initiatives, and policies.
In much the same way, the Philippines cannot be content with only a crypto hub – we should aim to be a crypto country. Mainstream adoption of cryptocurrency in the Philippines can stand to help us in many different ways, including lowering the cost of remittances, extending financial inclusion to the unbanked, and accelerating digital commerce.
For the Philippines to get to this future, we must expand our map beyond the starting point in CVA, and ask this question: What will lead to widespread adoption of cryptocurrency across the entire Philippines?
This question is one that pro-crypto countries across the nation have struggled with. Market education of individual consumers may surprisingly not be the sole answer. Media coverage of cryptocurrency and related solutions are common, but they're not translating into action. Despite some efforts, only a minority of Filipinos own crypto now.
The much better alternative might be forced adoption. This strategy is far less intimidating and far more benevolent than it sounds. It simply means introducing cryptocurrency from the top-down (i.e. private enterprises and government agencies) rather than bottom-up (individual consumers). Forced adoption may be effective because it converts people to crypto en masse, provides them with a support system for learning the tech, and gives them regular touchpoints to habituate their usage.
Forced adoption can occur through human resources, for example. On their own initiative (or due to incentives from the government), a local company can elect to pay a portion of employee salary every two weeks in crypto. Such can be accomplished through many of the mobile money wallets made in the Philippines, such as Satoshi Citadel Industries’ Bitbit.
If employees receive crypto every pay period, they would become regular users of digital currency. No longer would they have to worry – as interested consumers usually do – about how to obtain a digital currency. The technical threshold that turns so many people away from owning cryptocurrency would have been effectively surmounted by the HR department that enrolled them in the company-wide, crypto compensation plan.
Forced adoption can also occur at the retail level. Brick-and-mortar retailers in the Philippines could, for example, avail of point-of-sale devices from Indonesia’s Pundi X. These XPOS devices enable anyone with an XPASS card to transact with crypto, enabling consumers the opportunity to finally use their digital currencies to purchase goods and services in the real world.
If a Philippine retailer were to adopt an XPOS device in-store, they could incentivize consumers to use crypto with a discount. Buying the same product in cash could cost full retail value, for example, while doing so in crypto via the XPOS would earn them a 5% off.
The principle behind this pricing is already used at many stores to encourage the use of debit or credit cards, so it could surely also work with crypto. Giving people a regular outlet to use cryptocurrency would go a long way in showing to consumers that it can succeed as a means of transaction.
Forced adoption can occur at every instance where money is dispensed or collected, such as through government agencies or even non-profit organizations. For this to happen, we must make bold decisions like some of history’s best tech entrepreneurs. Steve Jobs famously quipped that customers would not know what they want until you put it right in front of them, already fully realized.
In much the same way, public and private leaders must take a stand in deciding that crypto will be part of our country’s financial landscape, even as consumers are still only getting around to fully understanding it. Such measures will ensure that the Philippines stays ahead. While others in the region race to make a crypto hub, we will be transforming ourselves into a crypto country. – Rappler.com
Miguel Tan is an entrepreneur based in the Philippines. He is the founder and CEO of MVT Group of Companies, the primary holding and parent company of Faslcad Incorporated, Black Ocelot Securities Corporation, and Vesper Trading Corporation.