By the end of next year, at least five countries will accept Bitcoin as legal tender, the president of the Bitmex cryptocurrency exchange predicts. He gave three key reasons for reaching such a conclusion. “Developing countries will jump into cryptocurrencies in 2022,” he said.
The president of the Bitmex cryptocurrency exchange, Alex Hoeptner, predicted that developing countries would lead the way in Bitcoin adoption.
He described last week: By the end of next year, I predict we will have at least five countries that accept Bitcoin as legal tender.
All of them will be developing countries. Here’s why I think developing countries will jump into cryptocurrency in 2022. The CEO outlined the three main factors driving Bitcoin adoption in developing countries and why he came up with this prediction.
The first is money orders. Remittances accounted for 23% of El Salvador’s GDP in 2020, Hoeptner described. Citing World Bank data, he added that low and middle income countries receive about 75% of all global remittances and $ 540 billion in remittances went to low and middle income countries in 2020.
„This money has to find a way home somehow,” he said. “But the current money transfer system – run by money service providers like Western Union – is cheating people by charging them an average of 10% just to send the money home the next business day.”
Inflation is the second factor. The International Monetary Fund (IMF) forecasts inflation for developed countries in 2021 at 2.4% and 5.4% for developing countries. During inflation crises, he explained, people look for alternatives to fiat currencies. For example, he said: “As inflation in Turkey has risen well above 15% this year, cryptocurrency adoption has soared.
Turkey responded with a swift ban on the use of cryptocurrencies for goods and services, but inflation is now 19.25%. Hoeptner noted: Bitcoin solves this problem with limited supply to 21 million.
And developed countries and their inhabitants notice it. Politics is the third factor. He explained that many politicians or rulers “are talented and bright and interested in positioning themselves as progressives, populists and new age thinkers.”
He commented: “Over the next year, as El Salvador has problems with its introduction, seasoned politicians will consider how they can follow a similar path and how it could benefit both them and their constituents,” explaining: El Salvador made its first leap of faith, making similar moves by other countries much easier to consider.
However, the CEO warned: “Any mistakes by these leaders during the deployment phase could harm wider cryptocurrency adoption overall. This is a dangerous dilemma ahead of us.
12-10-2021, Mr Advice TEAM