5 reasons why Bitcoin has grown in Latin America
Latin America has become a fertile territory for Bitcoin and other cryptocurrencies. The volume of exchange through Localbitcoins has grown significantly, but also the interest of public opinion. What has this region that is so favorable for Bitcoin?
The national tables of each of the countries have their differences, that is, we do not speak of a homogeneous block. At the difficult socio-political moment that Venezuela is experiencing, the deterioration of the Argentine economy is added without any difference; the Chilean push; the renewed interest in the development of the country of the State and the Colombian entrepreneurs, the development policies and the new direction of Mexico, the imposing presence of Brazil -being one of the most important countries in the world-; and thus, each country of the region, with its own nuances, demonstrates an interest in Bitcoin that could be classified as generalized.
Some of the main reasons about the potential that Bitcoin and other cryptocurrencies can have for the improvement of the region.
The Latin American economy is composed of countries that are still developing. The growth of countries like Peru, Chile and Panama has also had an impact on the interest of its citizens in Bitcoin and cryptoactives, both as a means of investment and to create services and products associated with its operation.
The birth of new exchange houses or companies specialized in ATMs and points of sale, among other businesses, shows that cryptoactives are also being taken into account at the corporate and business level. Although these initiatives may be still incipient or have a relatively small scope, Latin American entrepreneurs are increasingly encouraged to try business associated with this technology.
Be your own bank
One of the main elements in favor of Bitcoin in Latin America is the opportunity to have a global financial services platform (albeit with its own nuances and unique characteristics) for the unbanked. The traditional banking system has excluded many of the citizens of this region, limiting the management of personal finances, imposing its own logic and operation over the needs of users.
However, Bitcoin as a global value exchange network proposes a more inclusive model. Beyond the high costs that the currency created by Satoshi Nakamoto is always accused of, Bitcoin is the only cryptocurrency that offers the sending and receiving of money, in a cross-border and non-reprehensible way, that those that are not yet part of the system require. traditional financial system, either for not meeting the consumer profile or for not having the necessary precautions.
These potentialities are a tangible reality in the region today. Bitcoin is being used for remittances, as a safeguard of value in high inflation environments and also as a commercial alternative (although of low use) to traditional payment systems.
According to information from Statista, published in June of this year, five Latin American countries are in the top-10 countries with the highest exposure to Bitcoin and other cryptocurrencies. According to this information, citizens of Brazil, Colombia, Argentina, Mexico and Chile have claimed to use or own cryptocurrencies.
In addition, Latin America is the scene of several high-level events, where different members of the user and investor community meet. In many of the countries there have been such meetings that only strengthen ties between the countries of the region.
There are several teams of international scope that are already working in Latin America. The Latin American Blockchain Alliance, which has a node in each country, is proof of this interest. Several exchange houses and other services associated with cryptocurrencies and the cryptographic projects themselves have communities in the different countries of the region, consolidating collaboration and common development.
In general, Latin America still has a legal framework that is friendly or not defined on cryptocurrencies. There are no strict prohibitions on the use of cryptocurrencies, although central authorities usually warn about the risks of this type of investment. There are countries like Venezuela where the government itself tries to advance in the development of a supposed cryptocurrency that, although it could not be compared to Bitcoin, shows that the issue has even reached the institutionalized spheres of power. Cryptocurrencies are a common theme among regulators in Latin America.
The Colombian government has demonstrated its openness regarding blockchain technology, ensuring that if its implementation at the state level can help alleviate corruption, the government could use it. Although the exchange houses have had difficulty operating in the country, 2019 has seen how Buddha or Panda Exchange have resumed operations.
In the rest of Latin American nations, a regulatory framework is also discussed, without the general climate that is breathed being toxic for the growth of this industry and the well-being of the users of cryptocurrencies. It is worth highlighting Mexico, whose Fintech Law is an example for the region and for other countries internationally.
The common ground is that governments have not yet directly attacked cryptocurrencies and the most closed regulatory environments, yet they do not censor or prohibit Bitcoin. As long as that does not happen, good news.
Relationship with value
Bitcoin was originally born out of the need for Nakamoto and other cypherpunks to provide a value system robust enough to deal with money managed by banks and governments, but also auditable enough so that users could fully trust in the execution of the protocol, leaving the ethical problems of value sharing aside, giving possible support to a global economy only in the logical consistency of its programming.
Bitcoin has been functioning seamlessly for at least 9 years, without the economic projections made on its intrinsic functioning (inflation, the emission of new bitcoins, among other features) in its network, the value exchanged by users is not they depend on social conditions, political conflicts or the economic ineptitude of the rulers. 1 BTC is 1 BTC.
Fiduciary currencies, on the other hand, have shown that their behavior obeys powers and decision makers that are far above citizens. The Venezuelan bolivar is worth less than nothing due to the mismanagement of the government, and the same cause could be attributed to the decline of the Argentine peso. Citizens do not have any control over the value of their own work, which falls without them being able to do anything. This is a constant in the history of the region, because despite its current strength, other economies in the region have also experienced cycles of decline, caused mainly by the mismanagement of governments.
In this economic context (current and also historical), the relationship with value is somewhat different in this region than in countries with more stable economies. The opportunity offered by Bitcoin for each member of the network to autonomously manage their personal finances is much more attractive for volatile and developing economies, where money usually loses its value, than for more stable countries.
These are some of the most important reasons for the strength of Bitcoin in Latin America, the genuine interest that more and more Latin Americans show in this technology and the positive reach that it could have both in the individual sphere (as a highly profitable medium of investment) and on a social level.
Disclaimer: This press release is for informational purposes information does not constitute investment advice or an offer to invest. The views expressed in this article are those of the author and do not necessarily represent the views of infocoin, and should not be attributed to, Infocoin.