Lugano and El Salvador are at the forefront of Bitcoin use; will others follow?
Lugano, Switzerland, accepted Bitcoin as legal money earlier this month. Local businesses were also pressed to accept crypto payments in ordinary transactions by the authorities. While anti-bitcoiners were shocked by Lugano’s crypto announcement, the crypto community was expecting more governments and areas to embrace Bitcoin as a result of rising inflation, unpredictable geopolitical conditions, and BTC’s role as a hedge against an unstable global economy.
Bitcoin’s global adoption is being driven by its long-term potential.
El Salvador’s GDP increased by 10% as a result of the acceptance of Bitcoin as legal tender.
How much have volumes increased or decreased in Q4 2021?
Lugano is following in the footsteps of El Salvador, which became the first Central American country to adopt Bitcoin as legal currency last year. Despite criticism from international financial institutions such as the World Bank and the International Monetary Fund, El Salvador’s president, NayibBukele, has maintained the country’s Bitcoin approach. The Central American country reaped the benefits of the adoption, as its GDP increased by more over 10% in 2021, the greatest level in its history.
Additionally, El Salvador’s tourism increased by more than 30% following the acceptance of Bitcoin.
But why have governments and cities begun to accept Bitcoin as legal tender? What are the flaws in today’s financial system? Are other countries emulating El Salvador’s example?
“In an uncertain economy, Bitcoin could be a potential ‘way out’ to preserve existing assets,” stated Marc P. Bernegger, Co-Founder of the Crypto Fund AltAlpha Digital. Bernegger also believes that the current macroeconomic climate is fragile. “More and more investors are questioning the viability of our actual monetary system, especially after the tremendous money printing due to COVID,” he stated, referring to the flaws in the global financial system.Additionally, El Salvador’s tourism increased by more than 30% following the acceptance of Bitcoin.
But why have governments and cities begun to accept Bitcoin as legal tender? What are the flaws in today’s financial system? Are other countries emulating El Salvador’s example?
“In an uncertain economy, Bitcoin could be a potential ‘way out’ to preserve existing assets,” stated Marc P. Bernegger, Co-Founder of the Crypto Fund AltAlpha Digital. Bernegger also believes that the current macroeconomic climate is fragile. “More and more investors are questioning the viability of our actual monetary system, especially after the tremendous money printing due to COVID,” he stated, referring to the flaws in the global financial system.Additionally, El Salvador’s tourism increased by more than 30% following the acceptance of Bitcoin.
But why have governments and cities begun to accept Bitcoin as legal tender? What are the flaws in today’s financial system? Are other countries emulating El Salvador’s example?
“In an uncertain economy, Bitcoin could be a potential ‘way out’ to preserve existing assets,” stated Marc P. Bernegger, Co-Founder of the Crypto Fund AltAlpha Digital. Bernegger also believes that the current macroeconomic climate is fragile. “More and more investors are questioning the viability of our actual monetary system, especially after the tremendous money printing due to COVID,” he stated, referring to the flaws in the global financial system.Additionally, El Salvador’s tourism increased by more than 30% following the acceptance of Bitcoin.
But why have governments and cities begun to accept Bitcoin as legal tender? What are the flaws in today’s financial system? Are other countries emulating El Salvador’s example?
“In an uncertain economy, Bitcoin could be a potential ‘way out’ to preserve existing assets,” stated Marc P. Bernegger, Co-Founder of the Crypto Fund AltAlpha Digital. Bernegger also believes that the current macroeconomic climate is fragile. “More and more investors are questioning the viability of our actual monetary system, especially after the tremendous money printing due to COVID,” he stated, referring to the flaws in the global financial system.
Alternative Investments
According to the basic definition, different assets are those assets that are not adequate enough to fall into the categories of stocks, bonds, and cash. While Bitcoin began its journey as a “risky asset,” and some still believe it is, BTC has established itself as the most important alternative currency in recent years. According to Bernegger, the recent global financial crisis and sky high inflation have ‘pressured’ investors to look into alternative assets such as Bitcoin. The growing interest from institutions has aided in the adoption of the world’s most valuable digital asset, particularly following the huge money printing caused by COVID.”
The Long-Term Potential of Bitcoin
BTC’s recent success is due to a mix of short-term and long-term investor interest. Long-term investors trust in the expanding acceptance of cryptocurrency assets, whereas short-term investors seem to be more interested in price movement and rallies. “Long-term investors feel that Bitcoin has the potential to revolutionize the direction of the world financial system in the years ahead, and almost surely will.” Long-term thinkers in places like Lugano and El Salvador see putting infrastructure in place to allow frictionless cryptocurrency movement as a natural and necessary step for the future,” said Jason Deane, an analyst at Quantum Economics.
Long-term Bitcoin holders, according to Jason, genuinely comprehend the crypto asset’s decentralized character.
Bitcoin Adoption by Institutions
In the last few months, the overall lot of corporations embracing Types of payment method has risen dramatically. According to Crypto.com’s analysis, the total number of cryptocurrency users will reach 300 million in total of 2021. But by end of 2022, the number is predicted to reach one billion. Companies have begun to recognize the potential of Bitcoin as a result of its expanding global usage, which is why companies such as Overstock, Starbucks, and Newegg are now taking Bitcoin as a form of payment.
“Non-traditional payment methods, such as those enabled by bitcoin technology, have received a lot of support.” The fact that eBay is contemplating cryptocurrency as a new form of payment is a fascinating development. Some may argue that it reflects bitcoin’s growing acceptability, heralding a new era in financial technology. “Bitfinex’s CTO, Paolo Ardoino, stated that bitcoin’s rising popularity “undoubtedly proves the value as the bottom layer of an alternative financial sector.”
Shift in Tone
In the last few months, the mood around Bitcoin has shifted dramatically. For example, JPMorgan CEO Jamie Dimon once referred to Bitcoin as a “fraud.” JPMorgan is now looking into several options in the global crypto industry. According to Farah Mourad, Senior Market Analyst at XTB MENA, European countries’ attitudes about Bitcoin and other crypto assets have shifted.
“Lugano’sBitcoin move is a significant step forward for cryptocurrencies on the old continent, where European Central Bank President Christine Lagarde had described digital assets as’suspicious.'” “After the European Union rejected a draft regulation that might have prohibited the cryptocurrencyBitcoin all across EU, there has been a shift in tone,” Farah noted.
While El Salvador and Lugano already have recognized Bitcoin as legal currency, other countries with high inflation and a stumbling economy are considering doing so as well. According to rumors, countries such as Mexico, Honduras, and Argentina are looking into accepting Bitcoin.