BitMEX CEO Alexander Höptner predicts that at least four more developing countries will adopt Bitcoin as legal tender in 2022.
“El Salvador deserves praise, not derision”
In a blog post published last week, Höptner commented on El Salvador’s move to make Bitcoin legal tender. While noting that there are significant risks attached, he thinks that El Salvador’s groundbreaking decision will make it easier for other countries to take the same leap of faith.
Höptner predicts that there will be at least five countries who have adopted Bitcoin as legal tender by the end of 2022. He also commented on president Bukele’s numerous critics, including the World Bank, Moody’s, and the mainstream media:
What the critics fail to recognise is that developing countries like El Salvador are leading the world in embracing decentralised digital currencies and payments. They’ve had decades to analyse how the global financial system works – and doesn’t work – for their populations. They acknowledge their powerlessness to influence monetary policy decisions that can have grave consequences on their citizens. They aren’t quite opting out of the monetary system status quo […], but they are choosing to try something new. This deserves praise, not derision.
Bitcoin adoption will be driven by remittances, inflation, and politics
As leading factors for a possible decision to adopt Bitcoin on a nationwide scale, Höptner has identified three influential points. The first one is remittances, which are sent home to their families by abroad workers. Höptner calls out transaction intermediaries such as Western Union for “ripping people off” with unnecessarily high transaction fees.
Thanks to modern Proof of Stake blockchains, money can be sent anywhere around the world within seconds, at the cost of merely a few cents. For people living in a developing country like El Salvador, which relies on remittances, cryptocurrencies provide a much cheaper and faster way of sending money home.
The second factor, inflation, goes without saying. As inflation rates are on the rise due to Covid-19 stimulus packages and developing countries are affected the most by inflation, the population will continue to seek out a sound monetary system. Despite, or arguably because of China’s and Nigeria’s crypto-hostile stance, these countries are among the leading places for the adoption of Bitcoin and other cryptocurrencies.
The final factor is politics. Despite making clear that his blog post is not a “love letter” to Nayib Bukele, Höptke called the Salvadoran president “skilled and savvy” and states that other young leaders will become interested in “positioning themselves as progressive, populist, and new age thinkers.”
He closes his article with calling out critics once more:
Fear of change is understandable. But it doesn’t have to be crippling. Faced with an inherently unequal financial system, those who have the most to lose by continuing the status quo are acting in their self-interest to explore alternative options like Bitcoin. It would be wrong – and hypocritical – to thumb our noses at them while continuing to benefit from that same unequal system.