all about cryptop referances
After living in the chaos of a deep crisis, people in Lebanon have turned to cryptocurrency, a new media report has confirmed. From earning much-needed income through mining and labor, to storing wealth and paying in stores, bitcoin, tether and other cryptos have begun to push aside the hyper-inflated Lebanese pound and the hard-to-find US dollar.
With its capital Beirut once dubbed the “Paris of the Middle East” before civil war broke out in 1975, and known as an offshore banking destination to rival Switzerland after the conflict ended in 1990, in recent years Lebanon has struggled to cope with a looming economic and financial crisis — among the world’s worst, according to the World Bank.
The country plunged into crisis in 2019 and the government defaulted on its national debt in early 2020, just as the Covid pandemic spread across the globe. With losses of up to $70 billion in local banks, according to Goldman Sachs, inflation expected to reach 178% this year, as estimated by Fitch, and close to 80% of the population living below the poverty line, estimated by the United Nations, cryptocurrency has begun to sound as a source of salvation for some, CNBC notes in a report.
The broadcaster reached out to a number of locals for whom decentralized digital cryptocurrencies have become a lifeline for survival. While crypto adoption took different forms in each case — from mining dogecoin and earning bitcoin, to using tethers — all of these Lebanese citizens praised access to a type of money that makes sense to them in the current circumstances. Their experience is best described by the words of Georgio Abou Gebrael, a 27-year-old architect from a small town near Beirut, who now earns half of his income through crypto-paid freelance work found online:
Bitcoin has really given us hope. I was born in my village, I’ve lived here all my life, and bitcoin has helped me stay here.
Others like Ahmad Abu Daher, a 22-year-old graduate of the American University of Beirut, recognized the potential of crypto mining as a profitable venture. A little over two years ago, he started minting ether, when the coin still relied on the proof-of-work consensus mechanism. He used electricity generated from a hydroelectric project on the Litani River in southern Lebanon.
After starting with just three mining rigs, Daher and his friend have since established their own crypto farm and are now hosting rigs for other people as well. One of them is Rawad El Hajj, a 27-year-old with a marketing degree, who has a dozen machines minting litecoin and dogecoin at Daher’s facility, earning him over $400 a month.
Bitcoin has replaced fiat in payments from abroad for people like Gebrael, who says accepting US dollars will mean receiving a much smaller amount than originally sent and in pounds. Lebanon has also traditionally relied on remittances, which exceeded a quarter of gross domestic product in 2004. But pharmacist Marcel Younes uses the crypto mostly as a store of value. The man withdrew all the money from his bank in 2019 and has since converted 70% of his cash into bitcoin.
When asked how reliable it is to keep his wealth in an asset that lost 70% in the last year, Younes told CNBC that he is not too worried about the price of BTC as he bought his coins when it was around $20,000 and recalled that the leading coin sold for just $3,500 three years ago.
Other Lebanese have more faith in tether (USDT), the stablecoin pegged to the US dollar. “We started selling and buying USDT because the demand for USDT is very high,” admitted Abu Daher, the miner who also offers crypto exchange services.
Although the use of crypto as a means of payment is prohibited by law, a growing number of businesses have begun to accept payments in Tether and other coins. “There are many coffee shops, restaurants and electronics stores that accept USDT as payment, so it’s convenient if I need to spend not in fiat, but from my bitcoin savings,” said Gebrael, the young architect who relies on crypto to patch his budget each month.
Do you expect cryptocurrencies to attract more Lebanese users if the crisis in their country deepens further? Tell us in the comments section below.
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