- In the new, 2022, bitcoin will be accepted as legal tender in three more countries, predicts Nigel Green, CEO of global financial giant deVere Group.
- As a reminder, El Salvador made history by becoming the first country in the world to make Bitcoin an official currency alongside the US dollar in September.
- Nigel Green suggests that due to a similar dependence on remittances, countries such as Panama, Paraguay, Guatemala, and Honduras may also officially recognize bitcoin.
In the new, 2022, bitcoin will be accepted as legal tender in three more countries, predicts Nigel Green, CEO of global financial giant deVere Group.
As a reminder, El Salvador made history by becoming the first country in the world to make Bitcoin an official currency alongside the US dollar in September.
President Nayib Bukele on Bitcoin
Addressing his 3.2 million followers, Salvadorian President Nayib Bukele tweeted a series of predictions about Bitcoin, mentioning that “two more countries will accept it as legal tender.” Among others, it was indicated that this year the cryptocurrency will grow to $ 100,000.
Mr Greene believes that low-income countries have long suffered from weak and highly vulnerable to the market in their currencies, and this has caused runaway inflation. This is why these countries rely on major First World currencies such as the US dollar. However, dependence on another country’s currency also carries risks. For example, a stronger US dollar will affect the economic outlook for emerging markets, as emerging economies have taken on so much dollar debt in recent decades.
Nigel Greene adds: “By adopting cryptocurrency as legal tender, these countries immediately receive a currency that is unaffected by the market conditions of their own economy or the economy of another country.
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In addition, he notes, cryptocurrencies can also help “increase the availability of financial services for individuals and businesses” in developing countries, as they “can bypass the biases” of traditional banks and other financial service providers.
Following a bold tweet from President Bukele that more countries will begin accepting bitcoin as legal tender this year, his followers named Tongo, Turkey and Bolivia as the first contenders for admission.
Nigel Green suggests that due to a similar dependence on remittances, countries such as Panama, Paraguay, Guatemala, and Honduras may also officially recognize bitcoin.
“Immediately after El Salvador in September, Panama initiated a bill making cryptocurrency legal tender in the country. In addition, Congressman Gabriel Silva tweeted that this could create additional jobs in Panama and attract investment from other countries.
“A Paraguayan bill aimed at regulating the trade and mining of bitcoins and cryptocurrencies in the country was passed by the Senate last month. Is this the first step towards making Bitcoin legal tender? ”Muses Greene.
The central banks of Honduras and Guatemala are keeping an eye on digital currencies, officials said, but they are taking a different approach for now.
The country’s authorities actively encouraged citizens to use the Chivo cryptocurrency and cryptocurrency wallet. In October, El Salvador’s President Nayib Bukele announced that the service was used by 3 million people. For comparison, the country’s population is 6.5 million, according to the World Bank for 2020.
In November, the International Monetary Fund (IMF) published a report on the level of effectiveness of bitcoin legalization in El Salvador. The experts concluded that the decision of the country’s authorities carries risks for consumers. The IMF drew attention to the high level of bitcoin volatility. Fluctuations in the cryptocurrency rate, according to experts, can also lead to financial losses among the citizens of El Salvador who switched to BTC.
“They are currently researching central bank digital currencies (CBDCs). This demonstrates once again that they, too, are confident that the future of money lies in digital technology.
“However, I think they will eventually accept the existing cryptocurrency as legal tender, as El Salvador did,” says Nigel Green.