Understanding the use of crypto in PNG
06 February 2025
PETER S KINJAP
PORT MORESBY - Crypto (cryptocurrency) is digital money that exists only online. It’s not like kina or toea that you can hold in your hand. Instead, it’s stored on a computer or smartphone.
The best known crypto is Bitcoin but there are many others – Ethereum, Solana, probably hundreds more.
The four factors that make crypto special are:
No banks are needed: You can send and receive crypto directly to someone else without using a bank or money transfer service.
Transacting is fast and cheap: Sending crypto is quicker and usually costs less than sending money through traditional banks.
It’s global: You can send crypto to anyone in the world and they can use it right away.
It’s secure: Crypto uses a special technology called blockchain to keep it safe and prevent cheating.
Crypto is becoming popular in places like Papua New Guinea because, in remote areas where there are no banks, it allows people to save, send and receive money.
Digital money like crypto can be used anywhere even if people don’t have a bank account.
Suppose you live in a village and need to send money to a family member in Moresby. If you use Bitcoin, you don’t need to go to a bank, join a long queue or wait for opening hours.
You can send money from your phone at any time and the recipient will get it almost instantly.
Bitcoin uses blockchain, a type of shared database used as a transaction ledger.
Every time someone sends or receives Bitcoin, the transaction is recorded in the ledger. This ledger is retained in thousands of computers around the world. Transactions are transparent and safe.
Say you’re selling bilums to someone in Australia. If you’re paid with Bitcoin, you can get the money faster and cheaper than using a bank transfer. All you need is a phone with a Bitcoin app, called a wallet.
People in PNG are already using Bitcoin and other cryptocurrencies to pay school fees, buy goods, to save money or as an investment. The key is to start small, learn and always be careful.
If you want to learn more about how Bitcoin works from an independent source, you can link here to an extract from Investopedia.
Peter S Kinjap is the author of ‘Bitcoin Dream: Hope, Hype and Chaos’. You can contact Peter at [email protected]
KJ - Brings to mind WC Fields' saying to "never give a sucker an even break".
Posted by: William Dunlop | 17 February 2025 at 03:09 PM
Chris Overland - I am not sure in which part of the world you reside. In Australia cryptocurrency is being used and there are Crypto AMTs and Crypto companies all over.
For example, CoinTree is a cryptocurrency company based in Melbourne and was the official sponsor of the Melbourne Storm's Captain's Run.
The Australian Financial Security Authority (AFSA) approves cryptocurrency to be traded on CoinTree. AFSA oversees how cryptocurrency holdings are handled in Australia.
In the USA, Bitcoin is seen as digital gold and there is calling for a strategic bitcoin reserve by the federal government.
If your comments are credible, perhaps the US government is a scam.
Posted by: Peter S Kinjap | 17 February 2025 at 07:33 AM
The demise of Greensill contributed significantly to the downfall of Debit Suisse and it is merely a matter of time before the entire shadow banking sector collapses to leave plenty of blood on the streets.
Posted by: Bernard Corden | 16 February 2025 at 12:03 PM
I am dismayed to see that crypto currency is now being used in places like PNG.
Cryptocurrencies like Bitcoin are not backed by any government or assets. They are entirely the creation of a computer algorithm, and they are subject to rampant speculation and manipulation.
In practice, they are a gigantic Ponzi scheme, in which users gamble that they can benefit from fluctuations in the price of the currency, buying and selling whilst relying mostly on the 'greater fool' theory.
Everyone, including Papua New Guineans, should be very clear about the nature of cryptocurrencies and the risks involved in their use.
As will inevitably happen, the next major world financial crisis will see most holders of cryptocurrency simply wiped out in the frantic rush to dump rapidly depreciating 'assets' before they disappear entirely.
Government backed currencies are not entirely without risk and banks are not institutions most of us like, but their particular business model has survived many centuries and many periods of economic upheaval.
For this reason alone, I see no good reason to engage in a massive financial 'experiment', the rules of which are either opaque or effectively non-existent.
As the Romans said, Caveat Emptor!
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'Let the buyer beware' - KJ
Posted by: Chris Overland | 15 February 2025 at 10:07 AM