Bitcoin (BTC) has proven to be of tremendous value in crisis-hit countries, with live examples like Venezuela. The South American country, which had been in socioeconomic and political turmoil, saw accelerating demand for Bitcoin, as it was viewed as a safe asset to park wealth.
A similar story is being repeated in Argentina. However, the difference is that BTC is being traded at a premium of as much as 10%. The country has been bleeding due to political instability, and its native currency, the Argentine Peso, has drastically fallen in the past few days. While the global Bitcoin prices are fluctuating between $10,500 – $11,500, BTC was traded for as high as $12,000 and more last week.
This has also been the case in Hong Kong, as the speculations to the government’s reaction to the continued anti-government protests have severely damaged investments. Bitcoin was traded again at a premium in the Asian country, but at just 4%. As per reports, CEO of crypto funding company Arca, Rayne Steinberg said,
Bitcoin is becoming the asset of last resort in areas of extreme currency devaluation and political uncertainty. In the last week alone, Bitcoin is up approximately 50% against the Argentine peso and trading at a significant premium on local exchanges. And they are not alone, joining the ranks of Venezuela, Hong Kong and Turkey who have also experienced similar shocks.
In reality, Bitcoin is soon becoming a haven to securely park wealth, to protect it against the devaluation due to political and social issues of the land. This way, the true essence behind creating Bitcoin, which was to create a decentralized monetary system, is finally seeing the dawn and acceptance. Especially, in the countries which are either at a political tussle with Washington, or are facing domestic political instability, BTC has become a viable option, providing the much-needed stability to wealth and value.
Bitcoin has also grown to be among the most preferred assets, providing stability and value addition. Despite a dismal performance in 2018, when in dropped from the peak of $20,000 in December 2017 to as low as $3,500 in December 2018, the token has recovered phenomenally since February earlier this year and has more than tripled in the following months. On the other hand, Argentine Peso has lost more than 32% value against the USD, since the beginning of 2019.