After El Salvador, Paraguay tries to adopt Bitcoin officially

Key facts:
  • The adoption of bitcoin as a legal currency in El Salvador has caused a huge impact on the market.

  • Paraguay not only wants to legalize bitcoin, but also promote mining with renewable energy.

Recently, two Latin American countries have been the focal point in the cryptocurrency arena. One is El Salvador, which publicly proclaimed that it had adopted bitcoin as a legal currency, making it the first country to grant this cryptocurrency legal tender status. But it didn’t all end there. Now Paraguay could be the second country to adopt this digital asset, which would undoubtedly cause a great impact on the market globally.

The impact of Paraguay’s proposal to adopt bitcoin

A representative of the Paraguayan congress presented a proposal to grant bitcoin legal tender status. This would endorse mining with renewable energy, as well as other measures to turn Paraguay into the center of international cryptocurrency investments. Although there is still uncertainty about the proposal, at least one point was made clear: bitcoin’s influence is hard to ignore.

Positions are varied on this. Those in favor believe in the positive influence that the event has created. The population of El Salvador and Paraguay together is 14 million. Although it is small it can bring direct advertising to bitcoin, increase the number of carriers and achieve greater consensus.

This has positive implications on the decentralized development and global disclosure of bitcoin. Its impact will be much greater than the tens of millions if assessed in the long term. In terms of combined money supply and ranking of market values, bitcoin has surpassed most of the world’s national currencies. Currently, it is the fifth most used currency, behind the US dollar, the euro, the Chinese yuan and the Japanese yen.

According to data from a site dedicated to business asset records, bitcoin’s current market valuation of $ 653.3 billion places it in ninth place, second only to Apple, Microsoft, Saudi Aramco, Amazon, Alphabet, Facebook, Tencent and Tesla.

Bitcoin ranks ninth as the most precious business asset.

As is evident, bitcoin’s influence can no longer be ignored. So much so that some countries are trying to adopt it as legal tender. As more people become its bearers and advocates, leaving aside technical, economic and legal disagreements, perhaps more countries or economies will tend to adopt this cryptocurrency.

The other side of the coin: bitcoin’s detractors

On the other hand, opponents believe that the legalization of bitcoin in a country can seriously impair economic development of the same. Due to Bitcoin’s current network and technical weaknesses, it is very difficult for it to act as a payment method in daily economic activity, not to mention that its carrying capacity on the chain is too low to take on legal tender paper.

However, after El Salvador’s announcement, Athena Bitcoin, a U.S.-based bitcoin ATM manufacturer, claimed it planned to invest one million dollars in El Salvador to install 1,500 ATM units, in order to make the country the first bitcoin-powered economy in the world.

It should be remembered that it will be a path full of difficulties and challenges to make the population move from the traditional fiat currency system, to another one with so much uncertainty and fluctuation, as is the case of bitcoin.

A neutral view on bitcoin

Unlike the 2 views mentioned above, which are a bit radical, there are more voices expressing their neutral attitude. According to them, bitcoin should not be considered as a means of payment, nor equated to a technology, but as a great social experiment advocating decentralization and equal rightsand it also proposes a more rational way of distributing resources in response to an increasingly large and complex society. This digital currency offers more opportunities to distribute resources more efficiently, improving social productivity.

The impact of bitcoin globally is undeniable.

Although bitcoin has certain shortcomings, throughout human civilization, all innovations that result in transforming humanity have experienced questioning and denials. This was the case with Tesla’s alternating current, Marconi’s radio and the Internet in its initial stage, which today are already present in any corner of the planet. Similarly, bitcoin should be given more time and attention.

What to expect in the future from bitcoin adoption

10 years ago, very few people had heard about bitcoin. 5 years ago, only a part of people know about bitcoin. 3 years ago, people started to know bitcoin. 1 year ago, many people accept bitcoin. Today, Paraguay proclaims to legalize the use of this currency. What will happen 2, 5 or 10 years later…?

We don’t know about the future. However, what we do know is that, at present, the number of addresses with nonzero balances of bitcoin is approaching 40 million, while the world population, according to the latest published data, is 7.262 million. This represents 0.55% of the population, assuming that there are no duplicates of the 40 million addresses and one address per person.

Only 0.55% already demonstrates the enormous potential of this cryptocurrency. We have good reason to believe that bitcoin will not dieand eventually it will be accepted by people in general, we have faith in this. Of course, its price will rise beyond expectations.

Learn more about ViaBTC and all the services it has for you, such as its CoinEx exchange, its CoinEx Smart Chain and its ViaWallet wallet.

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