Data coming out of LocalBitcoins shows that awareness of digital currencies seems to be growing in Mexico and Venezuela.
LocalBitcoins volumes in Mexico hit an all-time high at the end of January, 2016, and Bitcoin trading activity in Mexico has been on a steady rise since then. For the week ending on 2016-07-09, Coin.dance charts show that trading volume in Mexico came in at 1,330,233 pesos, the second-best week since 2013!
Bitcoin’s stellar performance this year and the depreciation of the Mexican peso over the past two years, along with the growing digital currency infrastructure in the country, has undoubtedly contributed to Bitcoin’s rising popularity in the region.
The Mexican peso was trading at 14.5 to the US dollar at the start of the 2015. Today, the USD/MXN exchange rate is hovering around 18.33, a stunning drop in the space of 18 months for a national currency. Last week, Banco de Mexico raised rates half a percentage point to 4.25%, citing deteriorating inflation and economic growth expectations.
Given the prolonged weakness of the Mexican peso and how impotent the Mexican central bank has become, Mexico's tech savvy citizens may gravitate towards digital currencies in much greater numbers over the next several moths and years.
While Mexico’s currency has taken a beating and economic prospects aren’t exactly rosy, Venezuela’s economic misery is on a whole different plane; oil production has plunged to a 13-year low; daily food riots; rolling power blackouts. Food scarcity has gotten so bad that Venezuelan president Nicolás Maduro announced recently a new food supply system, which will be controlled by the country’s armed forces.
But despite the unstable electricity grid and rampant food shortages, trading on LocalBitcoins is growing on a weekly basis in Venezuela. For last week, Coin.dance shows a new all-time high of Bs97,328,710 worth of Bitcoin trades in the country.
Many opponents of digital currencies have claimed that Bitcoin will be useless in a full economic collapse where food and safety become primary concerns, but the dynamics in Venezuela seem to contradict these assertions. Even unstable mobile services and slow internet speeds haven’t dented Venezuelans’ appetite for Bitcoin.
Image credit: wikimedia
Did you like this article? Tip Me: