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Cryptocurrency questions for Pacific

A worldwide charity is employing cryptocurrency to alleviate Pacific communities out of poverty.

The blockchain technology has the potential to lift Oxfam’s humanitarian aid through unfluctuating cash donations.

But there are detractors to the use of the controversial digital currency.

Critics point out that the Pacific is simply a testing ground for the experimental technology, which is unregulated and has been long associated with financial scams.

Then there is the region’s limited internet connectivity, considered among the poorest in the world, providing additional challenges for the digital currency not linked to a traditional central bank.

Several Pacific nations have banned the use of cryptocurrency, while others have embraced it but also modified to protect its citizens.

Vanuatu was the first Pacific nation that welcomed the stablecoin in 2019 after a tropical cyclone dented the livelihoods of the people and aid was sorely required.

Oxfam’s cryptocurrency program
Vanuatuan market vendors participate in Oxfam’s cryptocurrency program. Photo: Arlene Bax/Oxfam.

Demand has increased further since the outbreak of Covid-19 and now at least 35,000 participants have signed up, benefiting in more than $A2.5 million handed out from the unblocked cash program.

But laws have since prohibited the trade of the currency in Vanuatu and that its use is supported only by cash in a traditional bank account.

Oxfam has defended its push of cryptocurrencies that have included bitcoin to best distribute its humanitarian assistance that has grown in recent years.

More than 700 affected Papuan New Guineans from floods and landslides in April of last year were delivered financial assistance through cryptocurrency and Solomon Islands is next on Oxfam’s list.

Oxfam’s website says: “The socio-economic impacts of the Covid-19 pandemic have only enlarged the burden on the humanitarian community, who now needs to assist more people with the same or fewer resources.”

Blockchain transfers saves costs of distributing aid, reduces delivery time and brings transparency and accountability in the process, Oxfam adds.

Oxfam first won the European Union 2020 Horizon Prize for Blockchain for Social Good in Aid category, which it says, “will support further scaling of the project beyond the Pacific region”.

It also took out the 2020 World Summit Awards in the Inclusion and Empowerment category for its “high social impact on promoting sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all and reducing inequalities”.

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