Photo by Aditya Vyas on UnsplashAn honest look at what digital assets deliver – and what they don’t.
Digital assets are increasingly presented as a tool for financial inclusion.
A smartphone and internet connection can, in principle, give someone access to digital assets without opening a traditional bank account or visiting a bank branch. In countries where large portions of the population remain underbanked – and where access to international financial services is limited or expensive – that has obvious appeal.
However, access to a digital wallet is not the same as meaningful financial inclusion.
Digital assets can remove some traditional barriers while creating new ones. This results in a shift in where the barriers to financial participation exist.
The Financial Inclusion Promise of Digital Assets
Traditional financial systems typically require a bank account, identification documents, physical infrastructure, and access to regulated institutions. These requirements exclude a significant share of the global population – particularly in emerging markets.
Digital assets can reduce some of these friction points. A person can create a self-custodial wallet without opening a conventional bank account. Depending on the asset and network, they can receive and transfer value across borders without relying entirely on traditional correspondent banking systems that are slow, expensive, and often unavailable in lower-income regions.
Stablecoins have created a particularly meaningful form of access. A person in a country experiencing significant local-currency depreciation may use a dollar-pegged stablecoin to hold an asset whose value is linked to the US dollar. For freelancers, small businesses, and people receiving money from abroad, digital assets can also provide alternative ways to receive and transfer value.
Cross-border transactions can sometimes be faster and cheaper than traditional alternatives, particularly where stablecoins reduce the number of intermediaries involved.
These use cases help explain why digital assets have gained attention as a potential financial inclusion tool, particularly in emerging markets. However, the ability to access an asset is only the first stage.
Access to a Wallet Is Only the Starting Point
Creating a digital wallet can be relatively easy. The key consideration is whether the user can make meaningful use of what is in it.
Liquidity is one of the most immediate issues.
A person may hold cryptocurrency or a stablecoin, but that does not automatically mean they can use it to pay for everyday expenses. They may still need an exchange, payment provider or P2P market to convert the asset into local currency. If liquidity is limited, conversion is expensive, or there are few businesses willing to accept the asset, the practical value of holding it is reduced.
The same tension applies to on-ramps and off-ramps.
Digital assets can reduce dependence on traditional financial institutions for certain transactions – but users frequently still rely on intermediaries when moving between the crypto ecosystem and the conventional financial system. The intermediary hasn’t disappeared; it has just changed form.
There is also a knowledge barrier specific to digital assets – though its significance depends heavily on who is using them.
For someone already familiar with wallets, networks, transaction fees, and private keys, these are routine considerations. For an ordinary person accustomed to conventional banking, they represent a fundamentally different set of responsibilities.
A typical bank customer doesn’t need to understand payment infrastructure to send money. They select a recipient, enter an amount, and confirm. If they lose access to their banking app, there are established procedures for recovery. If a fraudulent transaction occurs, the bank may be able to investigate, freeze an account, or provide some form of dispute mechanism.
Self-custodial digital assets work differently. Users must select the correct blockchain network, verify wallet addresses carefully, account for transaction fees, and protect their private keys or seed phrases. Blockchain transactions are also generally final once confirmed – there is no equivalent of calling the bank.
A single mistake of sending an asset to the wrong address, choosing the wrong network, losing a private key, or approving a malicious transaction can result in permanent loss of funds with little or no practical recourse.
The obvious counterpoint is that crypto exchanges can remove much of this complexity.
A user can hold assets on an exchange and interact with them through an interface that resembles online banking, with the exchange managing wallets, keys, and transaction infrastructure on their behalf.
However, that solution comes with a trade-off. The more accessible the system becomes for an ordinary user, the more it depends on an intermediary. The technical risks of self-custody may fall away, but the user becomes dependent on the exchange for custody, access, withdrawals, and compliance – a different kind of trust relationship, not the absence of one.
This produces two distinct models of participation.
Self-custody shifts responsibility toward the user. Custodial platforms shift some of that responsibility back to an intermediary.
Neither eliminates the underlying knowledge and trust requirements. They distribute them differently.
For someone comfortable with crypto, these distinctions feel routine. For someone whose entire experience of financial services has involved a bank that manages the technical infrastructure and provides recovery mechanisms when things go wrong, they represent a meaningful shift in how financial responsibility is allocated – and who bears the consequences when it isn’t.
Stablecoins: Access to Dollars, But for What Purpose?
Stablecoins illustrate both the potential and the limitations of digital assets as a financial inclusion tool.
A dollar-pegged stablecoin can give individuals and businesses access to dollar-denominated value without requiring a conventional US bank account. This can be particularly useful in economies where the local currency is volatile or access to foreign currency is restricted.
However, the use case for stablecoins is still developing.
Much of their activity today is connected to trading, transfers between exchanges, cross-border payments and other digital-asset activities rather than everyday purchases.
Their broader use as a means of payment, particularly for ordinary consumer transactions, is still evolving, and understanding this distinction matters when assessing their contribution to financial inclusion.
Giving someone access to a dollar-denominated digital asset does not automatically give them access to the financial services or economic opportunities they need.
For example, a user may be able to acquire USDT or USDC but still depend on an exchange, P2P market or other intermediary to convert it into local currency. If local liquidity is limited or there are few practical ways to spend the asset, its usefulness outside the digital-asset ecosystem may be restricted.
This does not undermine the financial inclusion potential of stablecoins. It simply means that their impact should be assessed against their actual and emerging use cases rather than assuming that access to a stablecoin is equivalent to access to a dollar bank account or a conventional payment system.
Stablecoin adoption is expanding beyond trading and into payments, remittances, and other financial activities, their contribution to financial inclusion may become more significant. For now, the extent of that contribution depends heavily on whether users can move between the digital-asset ecosystem and the wider economy.
Regulation Can Create Another Divide
Regulation affects who can participate and on what terms. Clear rules can provide consumer protection, establish standards for service providers and give legitimate businesses greater certainty.
Poorly designed regulation can have the opposite effect. Rules that are unclear, excessively restrictive or disproportionately expensive to comply with may reduce the number of regulated providers serving ordinary users. At the same time, weak regulation can expose users to fraud, poor custody practices and other forms of abuse.
In either case, the people with the fewest alternatives may bear the greatest consequences.
The regulatory challenge is whether regulation can provide protection without making legitimate access unnecessarily difficult.
What Financial Inclusion Actually Requires
Creating access is only the first step.
For digital assets to contribute meaningfully to financial inclusion, users must also be able to make practical use of them.
That means looking beyond wallet creation and considering several dimensions that determine whether participation is real:
Usability – can ordinary users understand and operate the technology without taking on risks they don’t fully understand?
Liquidity – can they convert or spend their assets when they need to, at a cost that makes sense for their circumstances?
Consumer protection – what recourse exists when an exchange fails, an account is compromised, or a transaction goes wrong?
Regulatory clarity – can legitimate users and businesses operate within a predictable legal framework, or does uncertainty push activity into poorly regulated channels?
These question also reveal an important distinction between access and inclusion.
A person may be able to open a wallet and receive cryptocurrency but if they cannot easily convert it, don’t understand the risks involved, have limited recourse when something goes wrong, or operate in a market without regulatory clarity, that access has limited practical value.
Digital assets can reduce certain traditional barriers to financial participation but they don’t eliminate barriers altogether. They move them – and in some cases, they create new ones for the people least equipped to navigate them.
It’s important to explore where the remaining barriers exist, who is affected by them, and how effectively the system facilitates meaningful financial participation for the people it aims to serve.
My Honest Assessment
Digital assets have genuine potential to promote financial inclusion. They offer alternative payment channels, facilitate cross-border transfers, provide access to dollar-denominated value, and allow people to participate in financial networks without depending entirely on traditional banking infrastructure.
However, they do not eliminate financial barriers. They redistribute them.
The traditional financial system places barriers around bank accounts, documentation, physical branches, and financial intermediaries. Digital assets can shift those barriers toward digital literacy, liquidity, on- and off-ramp access, consumer protection, and regulatory clarity.
That distinction matters when evaluating whether digital assets are actually advancing financial inclusion.
The number of wallets created is not, by itself, a meaningful measure of inclusion. A more useful measure is whether people can access digital assets, understand how they work, use them effectively, convert or spend them when necessary, and have meaningful protection when things go wrong.
Digital assets can contribute to financial inclusion. However, the effectiveness of access depends on the surrounding ecosystem, which includes regulation, infrastructure, education, liquidity, and consumer protections that facilitate meaningful participation.
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Financial Inclusion or Exclusion? Are Digital Assets Solving or Creating New Divides? was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story.