The presenter of the topic was the CMO of Localbitcoins, Jukka Bloomberg.
Localbitcoins is a P2P exchange based in Helsinki, Finland on 2012 and home to 6 million customers from across the globe.
Bloomberg discussed the following cases that have been greatly affected with economic turmoil such as inflation and political instability.
1. Venezuela
Source
For Venezuelans, bitcoin is used as an intermediary currency to access the USD economy; as a store of wealth; remittance; and international money transfers.
The drive toward Bitcoin is the hyperinflation in Venezuela Bolivars which set Venezuelans minimum wage salary to $2.00 in 2019 and is not enough to even buy a kilo of meat
2. Argentina
Argentina’s economy has been a bumpy ride. Moreover, the current situation of unstable financial environment and the weakening of Argentine Peso has driven people toward Bitcoin as an alternative investment.
Covid19 has also worsened the local economy of Argentina.
If you are from Argentina, I recommend that you check out Vibrant. It’s partnered with Stellar Foundation to provide Argentines savings against inflation.
How does it work?
Argentines can easily deposit Peso and it gets immediately converted to USDX. Whenever they also want to withdraw it back to Argentine Peso, they can do it easily on Vibrant app that’s both available on ioS and Android.
3. Nigeria
Compared to Europe, there is no unified financial system in Africa. Thus, Bitcoin acts as the cross-border payment between CNY/USD and Nigerian Naira (NGN).
4. Turkey
The economic and political situation in Turkey has been rocky due to inflation, debt, and unemployment.
In addition, the local economy is expected to drop 4% this year.
Bitcoin has also reached an all time high against Turkish Lira because of its falling price resulting to 1 Bitcoin bought over 83,670 liras.
Paypal, a payment processor, has also been banned in Turkey since 2016.
5. Lebanon
Source
The situation is Lebanon has been worsened by the pandemic as well as the Beirut explosion leading to its prime minister resignation.
It’s not a surprise that Lebanon’s economy is on the verge of sinking.
Hence, according to LOCALBITCOINS data, Lebanese people prefer BTC over Lebanese pound, stocks, real estate, bank account and gold.
6. Belarus
Similar to Lebanon, Belarusians prefer BTC over Rubles and other traditional assets.
In general
Economic turmoil leads to:
- falling trust in traditional institutions
- restrictions or censorship
- alternative currency and store of wealth against inflation
- increase remittance flows
This post is part of my daily takeaways from Blockstack FutureProofing event.
Data is from Localbitcoins.
Subscribe to my Telegram channel for self-care posts and illustrations.
Or read my blog and buy me a coffee with BAT as a content creator. You need BRAVE browser to do so.
Get Brave now. Better than Google Chrome or Safari by 1000%.
