What Are the Changes Between Blockchain and Frontier Market

If you want to find hidden market gems, you need to look where others haven't found them. One of the things that my peers wearing Gucci sandals don't pay attention to is the cutting-edge market.

Frontier market?

You've heard of emerging markets, and maybe you've invested. But most investors ignore the frontier market. God, are they out of date?!

As an investor proficient in cryptocurrency, the problem is not why you need to understand the frontier market. Instead, you need to know them. That's it

Frontier markets refer to countries that are less mature and even poorer than emerging markets. But all this may change soon.

This is because the widespread application of technologies that promote the cryptocurrency world - distributed ledger Technology (DLT), or blockchain - will attract people's attention to these neglected markets, because it is now being used to integrate the citizens of these markets into the world financial system.

I will tell you more about this trend, and I will give you some ways to help you prepare.

Frontier markets usually include small and underdeveloped stock exchanges and foreign exchange markets. MSCI Inc. estimates that at least two companies in the market have a market value of $800 million and are willing to consider foreign investment.

MSCI frontier market index consists of 29 countries: Argentina, Bahrain, Bangladesh, Burkina Faso, Benin, Croatia, Estonia, Guinea Bissau, C ô te d'Ivoire, Jordan, Kenya, Kuwait, Lebanon, Lithuania, Kazakhstan, Mauritius, Mali, Morocco, Niger, Nigeria, Oman, Romania, Serbia Senegal, Slovenia, Sri Lanka, Togo, Tunisia and Viet Nam.

Most people may not find half of them on the map. But if you invest properly, you can enter a world where profits are unknown.

The frontier market is small; Really small. The 29 countries account for only 0.3% of the global stock market value.

Looking ahead, emerging markets such as Brazil and China account for 8.8% of the global total.

Although the frontier market is small, there are few opportunities.

Just look at the scale of Africa: the United States, China, India and several other countries can integrate well into the African continent.

With so much land and so many people, there are so many opportunities.

That's why you should consider investing in frontier markets.

Natural resources. Africa is one of the most natural resource rich continents on earth. It is a major producer of diamonds, sugar, salt, timber, gold, iron, cocoa beans, cobalt, uranium, copper, bauxite, silver and oil.

A fast-growing middle class. Africa, for example, has the world's fastest-growing middle class. In the past 20 years, this number has doubled to 313 million people. The growing middle class has transformed into consumers with money to spend.

Africa's growing middle class

Population growth. According to the prediction of the Gates Foundation, Africa's population is expected to double by 2050, which means that the labor force will increase rapidly.

Low correlation with developed markets. Frontier markets have low correlation with developed markets such as the United States, Europe, Canada and Australia. For example, the correlation between the MSCI frontier market index and the S & P 500 index is only 59%.

Therefore, if the world's largest market is falling, the probability of the frontier market following suit is only about 50%. This provides an additional layer of diversification and risk management for your portfolio.

Now, this is the frontier market / encrypted connection

Many frontier markets are related to poverty. In some areas, only about 35% of households have electricity and about 20% have television.

In fact, there are about 2 billion adults in the border market who do not even have bank accounts. But more and more people do have smartphones and are willing to use them as "mobile money".

For "people without bank accounts", everex (eVx) is a blockchain startup company that provides remittance services, microfinance and legal tender conversion.

But the beauty of blockchain is that its use is far greater than sending and receiving payments. Blockchain is also used in the field of real estate documents and collections. It can even protect the network where we are trading.

Another company, crowdforce, is trying to achieve blockchain transformation in the frontier market.

The Nigerian startup is developing an application called payforce. It encourages local retail agents in each community to provide financial services.

Remember, in this trustless cash economy, many trusted retailers have provided similar services to their communities.

The app will allow people who were previously unrecognized in the economy to participate more actively. It will mainly serve as a bank account, but it will also provide micro services, such as managing bill payment, buying and selling cryptocurrency, and hosting cryptocurrency to legal tender transactions.

Crowdforce believes that through trusted people in each community, it can bring these cutting-edge markets into the digital age and onto the world stage.

The payforce mobile app can also help solve trust problems. Not only is it recommended by trusted members of the community, but it also uses a decentralized blockchain. Decentralization means that there is no one or government to verify the transaction. This means that all information is completely secure from hackers and other idlers.

Frontier markets are not risk-free. In fact, they are more unstable than developed markets. They may be politically unstable, have poor liquidity, have problems in financial / accounting reports, and sometimes have large exchange rate fluctuations.

However, I believe that the frontier market will bring huge profits. I believe that blockchains will help bring them into the world economy and have a solid foundation.

Because it is not publicly traded, it is impossible to invest in crowdfunding power. Everex gets a very low "e " (or "very weak") rating from Wes password rating.

However, there are other ways to invest in frontier markets with much less risk. You can do it from the American stock exchange you are familiar with.

If you are an ETF investor and are interested in frontier markets, there are three ETFs you should look at:

Guggenheim frontier market (FRN)

IShares MSCI leading edge 100 (FM), and

Global x the next emerging and frontier market (emfm).

Long term investors with high tolerance for volatility should consider allocating 5% to 10% to the frontier market.

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