Developing economies are more affected by issues related to remittances and inflation, BitMEX’s CEO said.
Countries in the developing world will soon follow in the steps of El Salvador and make Bitcoin (BTC) legal tender, BitMEX CEO Alexander Höptner recently predicted.
“My prediction is that by the end of next year, we’ll have at least five countries that accept Bitcoin as legal tender. All of them will be developing countries.”
Höptner told Cointelegraph that countries like Brazil and the Philippines could be among the following jurisdictions to adopt Bitcoin as legal tender. "I think it'll be like dominoes dropping, particularly when it looks likely that a powerhouse emerging economy like Brazil is set to make a move. With elections scheduled in places like Lebanon, Kenya, and the Philippines next year, look out for campaign pledges to make Bitcoin legal tender too," he said.
According to Höptner, developing countries will adopt Bitcoin faster due to three significant factors: the growing need for cheaper and faster international remittances, massive inflation, and political issues.
As opposed to consumers in more developed countries, people in developing economies are more affected by cross-border payments and inflation issues, Höptner said.
The CEO noted that remittances made up 23% of El Salvador’s gross domestic product in 2020, while the World Bank assessed that low- and middle-income countries receive about 75% of total global remittances. He added that people around the world are increasingly looking at Bitcoin as a solution to weather massive inflation, citing rapid crypto adoption in Turkey amid a 19.2% inflation rate.
Höptner went on to say that El Salvador’s Bitcoin move will make it easier for other countries to consider similar activities. “But if it’s a reality that politics will play a big role in the adoption of Bitcoin as legal tender, it’s also true that any failings by these leaders in the implementation phase may hurt wider adoption of cryptocurrencies in general,” he added.
A former CEO of German stock exchange Boerse Stuttgart, Höptner took over as CEO of BitMEX in December 2020, replacing Arthur Hayes.
Höptner is not alone in thinking that more countries will follow El Salvador’s lead in adopting Bitcoin. Last month, Cardano founder Charles Hoskinson predicted that a lot more countries would adopt cryptocurrencies. World-renowned computer programmer Edward Snowden also believes that “latecomers may regret hesitating.”
Some major figures in the cryptocurrency space have been hesitant to praise El Salvador’s crypto adoption sparked by President Nayib Bukele. On Friday, Ethereum co-founder Vitalik Buterin criticized Bukele’s approach to adopting Bitcoin, arguing that forcing businesses to accept a specific cryptocurrency is “contrary to the ideals of freedom that are supposed to be so important to the crypto space.”