Can Bitcoin Be a Legal Tender?

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Are you wondering if Bitcoin can be a legal tender? Here is why we believe that this digital money can be legal tender.

Bitcoin has been around for over a decade and has faced much criticism, with some countries banning it. Eventually, this electronic asset has proved to be a valuable and profitable investment. Satoshi Nakamoto created this virtual asset as a new form of money independent of government and other financial institutions. Also, this digital currency emerged as a response to the 2008-2009 financial crises. Moreover, Bitcoin has grown to become an investment rather than a form of payment.

Some countries, like El Salvador and the Central African Republic, have passed a law that made this virtual asset a legal tender. Legal tender refers to a form of money that a country’s authority says people should accept to settle a debt. However, for a currency to be considered legal tender, it should be reliable and stable. The value of Bitcoin, on the other hand, fluctuates wildly, making it difficult to use as a currency.  

Nothing stands in the way of a state from declaring something other than traditional currencies as legal tender. For instance, El Salvador benefited from the unbanked population’s financial inclusion, which led to economic growth. Some people believe this digital asset is a good hedge against inflation since fiat currency suffers from inflation when the government prints excess money and releases it to the public. Nevertheless, inflation is the decrease in the purchasing power of money. Bitcoin does not suffer from inflation since it has a hard limit supply cap. Only 21 million Bitcoins can exist, and due to the scarcity of this electronic money, demand increases, leading to an increase in value. Legalizing this digital asset has several different benefits, which include:

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Enhancing Cross-Border Transactions

Among the many benefits, this digital asset presents to its users, enhancing cross-border transactions is one of the main benefits. Some believe that Bitcoin is a credible solution for international transfers since sending remittances using fiat money can be stressful and exhausting. However, with this virtual asset, you only have to create an account with a credible and reliable exchange, such as the bitcoin 360 ai. After creating an account, you can top up your account with this virtual asset and get your recipient’s wallet address. There are no limitations in sending this digital asset, so making Bitcoin a legal tender would ensure that people benefit from efficient cross-border transactions. As an entrepreneur, you should not wait for long hours to receive payment for goods and services you may have delivered since Bitcoin transactions are instant and less costly. 

Empowering the Unbanked

Using fiat currency, one must physically go to a bank and create an account. While creating a bank account, one has to share personal information, which can be risky. Creating a bank account can be humiliating, especially for ordinary people, since many perceive banks as places for the rich and educated. In underdeveloped countries, a vast unbanked population cannot access government financial aid through banks. On the contrary, legalizing Bitcoin empowers that unbanked population just like El Salvador did after making this electronic asset a legal tender. 

Anyone can access this virtual asset provided they own a smartphone and has access to the internet. Also, to transact using this digital asset, they do not require special skills but only some primary education on Bitcoin and how to use an exchange platform.

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Final Thoughts

This virtual asset presents many benefits to the people and governments hence why it can be a tremendous legal tender. Even though some countries are yet to legalize this virtual asset, they will legalize it shortly. 

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