- “My prediction is that by the end of next year, we’ll have at least five countries that accept Bitcoin as legal tender. All of them will be developing countries,” the BitMEX CEO wrote.
- High inflation rates, hefty remittance fees, and political incentives might spur developing countries to follow El Salvador’s steps and adopt BTC as a legal tender next year.
- In Alexander Höptner’s opinion, mainstream media criticism of the Central American country’s Bitcoin law is unfair.
The recent move by El Salvador to make bitcoin a legal tender alongside the dollar spurred some criticism worldwide, but mainly among mainstream media, such as the Financial Times and Wall Street Journal, and renowned financial institutions, including the International Monetary Fund (IMF) and the World Bank.
Alexander Höptner, the CEO of bitcoin exchange BitMEX, explained in a blog post on October 6 that the immediate backlash sparked by the Bitcoin law in the Central American country reflects the opinion of those who benefit from the status quo.
“What the critics fail to recognise is that developing countries like El Salvador are leading the world in embracing decentralised digital currencies and payments,” Höptner wrote. “They’ve had decades to analyse how the global financial system works – and doesn’t work – for their populations. They acknowledge their powerlessness to influence monetary policy decisions that can have grave consequences on their citizens.”
Höptner went on to explain that making bitcoin a legal tender as El Salvador did in September doesn’t mean a complete opt-out of the established financial system. Instead, it means countries are looking for alternatives to better benefit their population and economy.
“They aren’t quite opting out of the monetary system status quo (El Salvador still retains its other legal currency, the US dollar), but they are choosing to try something new. This deserves praise, not derision,” he said.
Developing countries usually face an economic reality much different from developed ones. As a result, the status quo might not suffice — alternatives have the potential to provide a better quality of life for citizens, thereby improving the country as a whole. For that reason, the head of BitMEX predicts that more countries will follow El Salvador’s steps and bet on the alternative.
“My prediction is that by the end of next year, we’ll have at least five countries that accept Bitcoin as legal tender,” Höptner shared. “All of them will be developing countries.”
High fees in remittance inflows that reduce the actual amount of money transferred, recurrent high inflation rates, and political incentives might make the perfect environment for Bitcoin adoption to spur further.
Low and middle-income countries received around $540 billion in remittances in 2020, nearly 75% of total global remittances, according to the World Bank. The IMF has forecast that developing countries will experience over double the inflation rates that developed economies will take this year.
“Faced with an inherently unequal financial system, those who have the most to lose by continuing the status quo are acting in their self-interest to explore alternative options like Bitcoin. It would be wrong – and hypocritical – to thumb our noses at them while continuing to benefit from that same unequal system.”
- “My prediction is that by the top of subsequent 12 months, we’ll have at the least 5 international locations that settle for Bitcoin as authorized tender. All of them can be creating international locations,” the BitMEX CEO wrote.
- Excessive inflation charges, hefty remittance charges, and political incentives would possibly spur creating international locations to observe El Salvador’s steps and undertake BTC as a authorized tender subsequent 12 months.
- In Alexander Höptner’s opinion, mainstream media criticism of the Central American nation’s Bitcoin legislation is unfair.
The current transfer by El Salvador to make bitcoin a authorized tender alongside the greenback spurred some criticism worldwide, however primarily amongst mainstream media, such because the Monetary Instances and Wall Avenue Journal, and famend monetary establishments, together with the Worldwide Financial Fund (IMF) and the World Financial institution.
Alexander Höptner, the CEO of bitcoin alternate BitMEX, defined in a weblog submit on October 6 that the rapid backlash sparked by the Bitcoin legislation within the Central American nation displays the opinion of those that profit from the established order.
“What the critics fail to recognise is that creating international locations like El Salvador are main the world in embracing decentralised digital currencies and funds,” Höptner wrote. “They’ve had many years to analyse how the worldwide monetary system works – and does not work – for his or her populations. They acknowledge their powerlessness to affect financial coverage choices that may have grave penalties on their residents.”
Höptner went on to elucidate that making bitcoin a authorized tender as El Salvador did in September does not imply a whole opt-out of the established monetary system. As an alternative, it means international locations are searching for options to higher profit their inhabitants and economic system.
“They don’t seem to be fairly opting out of the financial system established order (El Salvador nonetheless retains its different authorized forex, the US greenback), however they’re selecting to attempt one thing new. This deserves reward, not derision,” he mentioned.
Creating international locations often face an financial actuality a lot totally different from developed ones. Because of this, the established order won’t suffice — options have the potential to supply a greater high quality of life for residents, thereby enhancing the nation as a complete. For that cause, the top of BitMEX predicts that extra international locations will observe El Salvador’s steps and guess on the choice.
“My prediction is that by the top of subsequent 12 months, we’ll have at the least 5 international locations that settle for Bitcoin as authorized tender,” Höptner shared. “All of them can be creating international locations.”
Excessive charges in remittance inflows that cut back the precise sum of money transferred, recurrent excessive inflation charges, and political incentives would possibly make the right atmosphere for Bitcoin adoption to spur additional.
Low and middle-income international locations acquired round $540 billion in remittances in 2020, almost 75% of complete international remittances, in keeping with the World Financial institution. The IMF has forecast that creating international locations will expertise over double the inflation charges that developed economies will take this 12 months.
“Confronted with an inherently unequal monetary system, those that have essentially the most to lose by persevering with the established order are appearing of their self-interest to discover various choices like Bitcoin. It will be incorrect – and hypocritical – to thumb our noses at them whereas persevering with to learn from that very same unequal system.”