The Stellar Onchain Effect: Real-World Impact on Real-World People
written by Riley Blackwell
In 2014, before Ethereum, before memecoins and NFTs, there was Stellar. An open-source payments protocol that brings permissionless financial access and services to the global South.
For many years, these real-world uses of blockchain technology have made Stellar a standout option for developers and founders looking to bring payments to real, everyday people.
We call them real-world uses to make technologies like blockchain seem larger than life, more than just bots pumping memecoins. Stopping to hear their stories, you begin to realize that chains like Stellar have a real impact on real people.
When emerging technology merges with emerging markets, we allow space for prosperity, giving an opportunity to imagine openness and freedom. For this reason, many believe the next great cohort of crypto adoption will come from places where the conditions and needs of the communities match what’s beautiful about the technology — its speed, versatility, and transparency.
Stablecoins Remain a Critical Focus for Adoption
Onchain adoption of stablecoins has never been more important for the tens of millions of people who need protection from inflation and access to better payment solutions. As builders of emerging technology, we may not always consider it, but the over 1.5 billion globally unbanked certainly do.
What does it mean to be unbanked or underbanked by the US and global financial empire? According to reporting by FastCompany on FDIC and World Bank data, the numbers are staggering — here are the facts:
- Over 15 million people in US households have no connection to a bank
- 48 million more are underbanked in the US
- An estimated one-quarter of the world’s adults are without a bank or mobile phone account
- This number soars to over 40% in the Middle East and North Africa
- Pre-paid debit cards cost $1, have $6 in monthly fees, and $3 in reload costs
Every day, we see more businesses go cashless, expecting a card to swipe, insert, or tap. As options to transact with USDC and other stablecoins increase, the need for traditional banking structures diminishes. Though cash isn’t going away anytime soon, as seen by the adoption of cash-in and cash-out solutions at MoneyGram locations in nearly 200 countries, the next imaginative step may likely be a future without cards altogether.
Stellar remains focused on serving these people and telling their stories. Meeting them where they are is key to this mission of accessibility. This means bringing stablecoins and a network of real-world builders to care for everyday people like you and me. These Stellar stories create a better internet and a better world for real people.
Real Stories From Real People
Where imagination and cultural impact collide with onchain accessibility is where Stellar truly thrives. Lives touched by new users finding simple access to solutions void of jargon is what makes all the difference. This is especially important for those who have never even had a bank account.
The ecosystem stories from the Stellar network reveal these very widespread ripple effects, which range from job creation to improved education opportunities and upgrades for local businesses.
Decaf: A Wallet That Meets Real World Needs
One of the more wholesome stories comes from Decaf, a non-custodial wallet designed for seamless entry to DeFi with easy crypto on and off-ramps in nearly 200 countries.
The Decaf Wallet makes crypto onboarding as simple as possible, creating an explosion of growth for markets in Latin America. Australian entrepreneur Zac Borrowdale saw an opportunity in a rural Colombian city known for its beautiful waterfalls despite initially facing a series of challenges. Zac now uses Decaf to bring real world onchain effects to over 60 women in San Francisco, Colombia.
Almost all of these women, now with access to savings and a stable income, are employed as virtual assistants and are heads of their household. This particular onchain effect led to:
- 40 of these women sent their children to schools in better conditions
- New local businesses, including a frozen slushies bar and clothing stores for women
- Upgraded espresso machines for local cafes with profits from increased sales
- Better furniture for local businesses, creating new third places
Integration with MoneyGram Access results in over $200,000 weekly in USDC outflows from Decaf Wallet, meaning users continually make the most of their paychecks and community resources.
MoneyGram Access: A New Wave of Users Welcomes the Digital Economy
One of the greatest unlocks for the Stellar ecosystem is access to one of the world’s best ways to onboard international users into crypto, with no bank account required. Many protocols struggle with expanding into these markets due to inaccessibility to cash-off ramps. MoneyGram Access solves this, making digital wallets accessible to more users than ever before.
All the countries that Decaf Wallet and many other Stellar solutions tap into are powered by MoneyGram Access at over 300,000 locations worldwide. This protects users from volatility while giving them an opportunity to cash out at brick-and-mortar shops. MoneyGram is a well-known establishment offering a friendly face and a bridge between cash and crypto.
This means developers on Stellar can tap into millions of people whom they otherwise wouldn’t be able to meet due to limitations on other blockchains, which is all the more reason to build better on Stellar.
In three simple steps for cash-in and cash-out, users can save time and money when abroad, cashing out their paycheck, or getting through the day. Whether you’re a digital nomad, student, business owner, or anything in between, MoneyGram makes USDC on Stellar a super easy entry to the digital economy.
Félix and Bitso: Proving Familiar Interfaces Gain Trust
Sending and receiving remittances is one of the most well-known hassles for our Latin American friends, and the Stellar network offers one of the simplest solutions to this problem.
The combination of Bitso, which serves over 5 million individual users, and Félix, a WhatsApp AI bot, reduces the travel time of remittances from up to 10 days to mere minutes. Not only does this eliminate safety concerns for users, but families no longer need to visit a money-transfer operator or deal with expensive fees.
From start to finish, the process uses a familiar chat-like experience in WhatsApp through Félix, as if talking to a friend, money is converted from US dollars to USDC for near-instant transfers on the Stellar network. This means tens of thousands of families get the remittances they need to survive and move on with their day with ease. Learn more about Félix and Bitso here.
Stellar Aid Assist and Vibrant Wallet: Helping Hands in Times of Need
The humanitarian reach of the Stellar network extends far beyond remittances and payment processing as well. In 2022, utilizing the Stellar Disbursement Platform (SDP), both the United Nations High Commissioner for Refugees and the International Rescue Committee used Stellar Aid Assist to distribute over $2M in cash aid to displaced refugees since the start of the Ukraine war.
Time is of the utmost importance in emerging crises, requiring care, speed, safety, and security to be top priorities. This very transparent process allows organizations to operate both ends of each transaction transparently. Transactions complete at near-instant speeds, taking just two minutes total from sending an SMS to recipients to downloading a Vibrant Wallet and receiving funds.
We’re actively working on expanding our reach beyond Argentina, targeting markets like Mexico, Brazil, Colombia, and more. Over the next year, we’re rolling out new features like the Vibrant Card, which will allow users to hold their balance in USDC and spend it in local currency, further empowering them in their day-to-day transactions. Jessie Serrino, Senior Product Manager, Vibrant
Vibrant Wallet is also a major relief for Argentinians, who have been using this non-custodial digital wallet to protect themselves from local currency devaluation. With users in 14 countries utilizing over 5,000 available billers, the mobile wallet is a strong use case for workers paid by US companies. Through an integration with Bitwage, a crypto payroll service, Argentinians like UFC fighter Guido Cannetti receive 100% of their salary in USDC via the Vibrant wallet.
The Stellar Onchain Effect
Onchain effects spread much further than just stablecoins, though. One such use case Stellar has seen over the years is providing microfinancing via ClickPesa Debt Fund to small to medium enterprises (SMEs). Entrepreneurs in Tanzania have no access to traditional banking, leaving brilliant operators with few options. Women like Ashura, one of Joshta Microfinancing’s customers, who runs a hostel housing students using such loans thanks to the Stellar network.
Not only do women and underserved individuals require these microfinancing solutions and access to credit, but soon, people interested in lending out USDC to these entrepreneurs could earn up to 12% APY while making a positive local impact. These ripple effects go beyond the surface, allowing community members and families access to funds for essentials like education, food, water, and phone minutes.
In the US, financial freedom means wealth creation, whereas in much of the rest of the world, economic freedom is about access. If a local community member gets a new job and is paid in stable crypto, they get it. It just clicks. This comfortability has enabled many to show others how simple it can be to access this newfound freedom.
Meeting People Where They Are
When investigating the various use cases and apps being built on the Stellar network, the message feels as easy as “use and move on.” This simplicity is what many seek in a crypto product.
Emerging markets are unique in that they seek to give back and truly care for the people and local businesses around them. Stellar brings a sense of hope to these people. Rather than creating an individualistic PvP environment, instant access payment-focused protocols built for the unbanked show love through user experience. This translates to wallets giving native language options, UX that feels more like Venmo or WhatsApp, and welcoming copy that invites curiosity in new users.
Stellar developers recognize that regular, everyday people don’t want to spend hours checking charts or farming airdrops. They have real problems to solve, from remittances to reducing trips and ATM fees — not to mention reducing the need for bags of local fiat that heighten safety concerns.
What Builders Can Learn from Stellar
Beyond payment processing and providing a sense of safety from volatility in emerging markets, what it seems Stellar is capable of uniquely presenting is a preservation of culture. With this very particular technology, women, girls, unbanked, and underbanked all over the world see themselves not just thriving but able to imagine a better internet they may not have otherwise.
Now that we’ve heard more stories from the expansive network of Stellar builders and users, what can we learn from the way they create change in emerging markets?
Firstly, contrary to most of the noise on social media, unbanked and underbanked folks require a few things from crypto: easy on-ramps and off-ramps that feel familiar, language and design that works, and use cases beyond casinos.
In the blockchain industry, we reach for better solutions to real world problems facing real world people. Whether those solutions are onchain or by creating more expressive, meaningful in-person connections, those solutions are out there today. We don’t have to wait to see the onchain effects on emerging markets. They may not be driven by hype, but this is by design.
Recently, hundreds of developers competed in a smart contract contest called Build Better On Stellar. In one of the categories, judges awarded $6000 to contestants who created an app focused on real-world positive impact. Other categories focused on written and video tutorials. Contests like these help educate and significantly improve the perception and messaging communities like Stellar produce, bringing awareness to the true onchain impact created.
Want to get involved with the Stellar ecosystem? Come to the 6th annual Stellar Meridian conference, in London on October 15–17 2024. We look forward to seeing you there!
