Countries can print legal tender currencies in unlimited quantities, which is reflected in increased inflation and loss of people’s purchasing power. An alternative to this, according to analyst and bitcoiner Max Keizer, is the adoption of bitcoin.
“’ Paper’money, mathematically speaking, always results in a loss of purchasing power. But, on the other hand, bitcoin is mathematically guaranteed to raise people’s purchasing power”, he commented during his presentation at LaBitConf 2021, held in El Salvador, which was the first nation to adopt the leading currency legally.
“Is Bitcoin volatile? Yes, but the vast majority of people are willing to accept this volatility, with the guarantee of increasing their purchasing power over time”, he said. “Do you want to have dollars – or any other fiat money – that will surely depreciate over time?” asked Keizer.
Fiduciary money is subject to devaluation
For Transfero’s Director of Products and Partnerships, Safiri Felix, this was one of the most “impacting” presentations at LaBitConf: “Keizer gave the audience the message that any official currency is subject to losing its purchasing value, including the dollar”, he said.
Incidentally, in Keizer’s view, developing countries, which are suffering the most significant dollar impacts, will be the drivers of bitcoin and other cryptoassets. “Bitcoin is capable of changing people’s lives, increasing and universalizing access not only to financial solutions, but also to basic services”, he stressed, referring to the rising prices of food, energy, and commodities.
For the analyst, the adoption and acceptance of bitcoin in El Salvador was a “statement of independence”, and other Latin American nations need to find similar solutions to maintain equality, stability, business, and jobs.
