Why Bitcoin is becoming popular in Latin America
News Americas, NEW YORK, NY, Thurs. August 11, 2022: There’s no denying that Bitcoin is making waves around the world, but Latin America is quickly becoming the world’s model for how cryptocurrency will permeate the daily lives of citizens for years to come.
All eyes have of course been on El Salvador, as the country has adopted cryptocurrency as legal tender. Everyone is fascinated to see how the citizens will be affected by this!
Why is the use of Bitcoin increasing in Latin America?
From Bitcoin sports betting to Bitcoin checkout options, there are so many different ways cryptocurrency is being integrated into our everyday lives. Latin America is seen as the perfect region to adopt Bitcoin for many reasons, many of which are based on promoting financial stability and increasing financial inclusion for its citizens.
For example, in Latin American countries money transfers are very common and they offer a perfect use case for Bitcoin.
At the start of 2021, these international transfers accounted for 11% of GDP in Mexico, 20% of GDP in Honduras and 20% of GDP in El Salvador. But although remittances can contribute a significant part of GDP in these Latin American nations, they involve long waiting times and high commissions.
People who have left their home countries to send money back to their families are forced to pay exceptionally high transfer fees, and their loved ones have to wait days or even weeks to receive the money.
Bitcoin provides the perfect solution here. Individuals have minimal transaction fees and money can be sent much faster.
Bitcoin is more stable than some Latin American currencies
There are volatile currencies in many Latin American countries due to political factors and high inflation rates. This is the case for Argentina and Venezuela, which have had rates as high as 69.5% and 1,575%.
Although cryptocurrencies are also considered volatile, they are more stable compared to some of these currencies. In fact, despite their volatility, Ether and Bitcoin have increased in value, while many Latin American countries have experienced hyperinflation.
We also need to consider the fact that crypto is decentralized, meaning it does not depend on banks, state-controlled institutions or other third parties. Many residents feel this is safer than relying on a fiat currency. After all, Latin American citizens do not need to rely on their governments, which they tend not to trust much, or third-party companies that simply act in their own interests.
The future is Bitcoin in Latin America
When you consider the points mentioned above, it is not difficult to see why Bitcoin has become so popular among Latin Americans. This is a trend that will only continue, especially if El Salvador shows positive results after making Bitcoin a legal tender in the country. It is certainly clear to see that Bitcoin has a great future in this part of the world.
