Bitcoin’s fundamental value continues to be underestimated by the anti-crypto community which is basically the larger part of the world’s population. However, recent statistics from coin exchange platforms like Localbitcoins indicate a high up take of this digital asset in South America countries led by Venezuela. The Chief Strategy Officer of Human Rights Foundation, Alex Gladstein also wrote an essay that concurs with Bitcoin’s potential of solving the financial inadequacies of over 4 billion people. At the moment, a good number of Venezuelans have opted for Bitcoin given the volatile nature of their currency.
The Bitcoin fever may have been over for investors after the bullish run in 2017 followed by the bear markets in most of 2018. One would expect the digital currency is no longer a catch but recent stats indicate more entrance in the market with sales hitting a high of 1974 BTC in the past week.
Venezuelans shift to the BTC has affected its neighboring countries like Columbia as they have since moved for safe havens. The financial refuge seekers continue to spend in BTC even after leaving Venezuela hence the spillover effect. President’s Maduro efforts of convincing the already fled population are bearing no fruits owing to the country’s economic crisis.
Bitcoin Vs Venezuelan Bolivar Volatility
Surprisingly, the bolivar has already matched the volatility of digital currencies since the Venezuelan economy started its downtrend. Bitcoin’s loss in value this year is at the range of 80’s in percentage, this may seem like a large figure but not to Venezuelans whom have seen the bolivar depreciate by 95% within 24 hours.
IMF has reported Venezuela’s inflation close to one million in the course of 2018, this figure is not only shocking but worrying for the developing nation. The range of inflation in developed countries like the U.S & Japan is monitored closely with changes even in just a percentage spiking outrage from the stake holders.
With almost no currency options left, Venezuelans can only hold on to their worthless bolivars or find means to purchase digital currencies like BTC. One Bitcoin economist through his editor, Vander Martin, said that the choice of BTC by Venezuela is definitely a reaction to the failing state of this economy hence devaluation. Furthermore, other regions have also joined the BTC bandwagon as they sought for safer financial havens.
Bitcoin; A Solution For Authoritative Regime Citizens
For those familiar with Bitcoin’s infrastructure, you probably have come across the logic of decentralization as aimed by cryptocurrencies. This is indeed a proven concept as witnessed by the various uses of BTC by holders or traders in today’s crypto markets. Citizens in authoritative regimes can evade the financial influence from the government by using digital coins whose decentralized nature puts them off the radar.
Governments that are not Human right friendly like China & Iran may also find its population opting for digital currencies. This is in efforts to escape the high level of scrutinizing by the authorities as well as other forms of censorship. In addition, BTC is a solution for poorly governed economies in emerging markets that have sunk due to uninformed policies like printing excess money.
Technical developments within the crypto arena has seen the rise of a new class of digital assets with the intelligence of sending coins in form of SMS. Monero, Litecoin, Dash & Zcash are among the popular digital currencies built with this ability. Going forward, remittances which account for a big chunk of global remittances will be more inclusive as a majority of citizens in developing countries remain unbanked.
So far, the number of BTC users is almost insignificant compared the world’s population, it only accounts for a mere 1%. This is barely enough to start a social media network that can match the likes of Facebook and Twitter. However, the potential target for BTC market stands at over 3.5 billion of the world’s population governed by authoritative governments.
In summary, Bitcoin’s development journey may be far from completion as well as the adoption rate but it remains a possible solution to half of the world’s population. At the moment, progress being made on digital wallets, coin exchanges and blockchain networks are slowly catalyzing the entry into the new era!