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More Countries Embracing Bitcoin, Crypto. Will the Future Be One Long Bull Market?

Much has been written about El Salvador and its making bitcoin legal tender, with most of the mainstream media focused on technical issues and protests among sections of the local population.

However, what’s lost amongst the widespread fixation on specific issues is the bigger picture, with Bitcoin and cryptocurrency (more generally) being steadily embraced by a growing number of nations and regions. Yes, because while most newspapers concentrate on Bitcoin’s apparent E-waste problem or its facilitation of money laundering, countries are increasingly turning to it as an asset and even as a means of payment.

Will Ukraine be the next country to embrace crypto?

Not only has El Salvador increasingly turned to bitcoin in recent weeks, but so too have numerous other nations in one way or another. These include certain US states, Germany, Ukraine, Cuba, Panama, Uruguay and Switzerland, which have either proposed new favorable cryptocurrency legislation or awarded licenses to cryptocurrency exchanges.

Of course, some might suggest these are predominantly small, largely ‘insignificant’ nations. Yet the fact is that, as more countries jump on the Bitcoin bandwagon, it will become harder and harder to stop. And indeed, most nations are moving more towards Bitcoin and crypto than away from it, suggesting that in the not-too distant future, cryptocurrencies will not only become more legitimate, but will also secure a vastly increased price.

It’s Not Only El Salvador That’s Turning to Bitcoin

Yet more eyebrows were raised just over a week ago, when representatives of the Ukrainian government met with counterparts from El Salvador. The reason? They wanted to discuss strategies for adopting Bitcoin as legal tender, as well as for making Ukraine a more crypto-friendly nation in general.

In fact, President Volodymyr Zelensky had presided over the passage of a bill officially legalizing cryptocurrencies only a few days prior to this meeting. As set out in the bill, the new law would introduce protections for consumers and businesses, thereby making crypto safer and more acceptable in the eyes of the Ukrainian public. It would define “legal relations arising in connection with the turnover of virtual assets in Ukraine, defines the rights and obligations of participants in the virtual assets market, [and] the principles of state policy in the field of virtual assets.”

On top of this, the government is now planning to open up Ukraine’s fledgling cryptocurrency market to businesses and investors by 2022, according to a spokesperson for the Ministry of Digital Transformation who spoke to the Kyiv Post. What’s interesting about this is that the same newspaper reports that Ukrainian law enforcement agencies had traditionally regarded cryptocurrencies as “a scam” and had conducted raids of related businesses, so this acceptance of crypto represents quite a startling turnaround.

Aside from Ukraine, Panama is another nation proposing to legalize Bitcoin and cryptocurrencies, and to encourage their use as payment. On September 7, Congressman Gabriel Silva introduced a bill, dubbed “Crypto Law: Making Panama Compatible with the digital economy, blockchain, crypto assets, and the internet.” It seeks to provide legal and fiscal certainty to the use and issuance of digital assets, much like the comparable bill passed recently in Ukraine. And while there’s nothing in the bill that explicitly proposes making bitcoin legal tender (in fact, a tweet says using crypto won’t be obligatory), numerous media outlets seem to think it paves the way for such a move.

There’s obviously something about Central/South America and cryptocurrencies, since Cuba passed a bill this month making crypto a legal payment method. This means bitcoin and other coins can be used for investment and commercial transactions within the country. Indeed, “investment” is a key word here, since as with El Salvador and Panama, Cuba’s government has reasoned that passing favorable legislation will expand the nation’s economy by attracting foreign (crypto-based) capital.

In August, Uruguay added itself to the list of Latin American nations becoming more open towards cryptocurrency, with a senator proposing a bill that would legalize cryptocurrencies as a means of payment and would also promote mining within the country.

Even Wealthier Nations Are Getting Interested

And despite the reputation of regulators within the United States for skepticism and opposition towards cryptocurrencies, at least certain states within the USA are embracing Bitcoin and crypto.

For instance, legislation came into effect in Texas in early September that grants cryptocurrencies commercial status within the state, making Texas the fourth state to pass such a law (after Wyoming, Nebraska and Rhode Island). Effectively, it makes it easier for cryptocurrency businesses to operate within the state, with reports suggesting that Bitcoin entrepreneurs are now “flocking” to Texas.

Looking beyond the Americas, certain wealthier nations within Europe are also becoming more nurturing of the burgeoning cryptocurrency sector. Germany famously moved in July to allow institutional funds to hold 20% of their portfolios in cryptocurrencies, having also passed laws permitting investors to hold securities that had been tokenized on a blockchain and regulating exchanges and custody services.

Across the German-Swiss border, Switzerland’s market watchdog FINMA awarded stock exchange SIX regulatory approval this month to launch a new crypto-exchange called SIX Digital Exchange (SDX). The landlocked European nation had also passed its own Blockchain Act in December 2020, setting legal standards for exchanges and also offering protections.

Backtracking on Suppression

Combined with the other examples above, this shows that the direction of travel is moving much more towards acceptance of Bitcoin and cryptocurrencies, as opposed to their repression.

For instance, India is now likely to soften a bill that would have harshly regulated cryptocurrencies, after it became apparent that crypto was gaining traction among the Asian nation’s population. “The government seems to be looking at this afresh considering that there needs to be a different take on how to regulate cryptocurrencies rather than push for an outright ban” said Rameesh Kailasam, the CEO of IndiaTech, speaking with Business Insider India.

At a time when the cryptocurrency market appears to be undergoing a correction (precipitated by the Evergrande and Chinese debt crisis), this emerging trend of growing acceptance — and declining hostility — towards Bitcoin and crypto should be reassuring. It adds further weight to the suspicion (or hope) among the community that cryptocurrencies are well and truly here to stay. Yet more than this, it adds weight to the suspicion that cryptocurrencies will also be used widely throughout the world, suggesting that the coins that emerge as the dominant cryptos in the future may end up having very high prices indeed.

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CryptoVantage Author Simon Chandler

About the Author

Simon Chandler

Simon Chandler is a journalist based in London. He writes about technology, markets and politics, and has bylines for Forbes, Digital Trends, CCN, Wired, TechCrunch, the Verge, the Sun, the New Internationalist, and TruthOut, among many others. His Twitter handle is @_simonchandler_

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