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After the state collapsed in 1991, the Somalis had the liberty to shift to another currency or adopt new ones along the Somali shilling; for example the currency used by trade partners. However, this didn’t happened and the Somalis continued to use the Somali shilling even when having the possibility to adopt other alternatives. Even if the Somali shilling eventually started to depreciate, there was no shift into another currency.
Wenzey recently wrote an article covering the nuances of competing currencies in developing countries citing network effects and switching costs as the main barriers.
What do you guys think of it? And what do you reckon can be done to speed up the rate of crypto adoption in developing countries?
Link to article: https://medium.com/@wenzey/competing-currencies-in-stateless-somalia-part-1-fc3da78d3da6