Even if the situation improves over time, Bitcoin still has a lot of opponents. All the powerful who benefit from the monetary and financial system tirelessly explain that Bitcoin is completely useless, and even dangerous. If all these criticisms make you doubt Bitcoin, I invite you to take a look at the hyperinflation ravaging Iran through this article.
Bitcoin was created by Satoshi Nakamoto to give citizens around the world an alternative to the current monetary and financial system which does not respect them. By offering Bitcoin to its users, Satoshi Nakamoto wanted to show that his unique invention was far more important than his leader.
With no leader to attack, Bitcoin became unstoppable at the same time.
For more than eleven years, no one has been able to stop the advance of Bitcoin. Bitcoin has become a subject that goes far beyond the world of cryptocurrencies now. Its capitalization of $ 170 billion, as well as his resilience to attacks of all kinds, are starting to scare his longtime detractors.
However, many people still seem to be having a hard time understanding why Bitcoin is so essential to ensuring a better future. All these people seem to forget the obvious interest of Bitcoin as a bulwark against hyperinflation.
They forget that Bitcoin has was created for the economic situation that the world acrosse.
People in the richest countries find it hard to understand why Bitcoin is essential
If you live in Europe or to United States, I understand that you are having a hard time understanding why Bitcoin is already a necessity for millions of people.
Indeed, although not everything is perfect, you live in democracies. They let you, for the moment, think that your money and your freedom of speech are assured. You think you don’t need Bitcoin as a bulwark against hyperinflation.
Under these conditions, you do not see why you should exchange your fiat currency for Bitcoin.
As a direct result of the coronavirus pandemic that is raging in the world today, the great economic crisis that we are starting to go through could reshuffle the cards. The limits of the fiat system, in which money no longer seems to have any real value, are exposed as never before.
See the Fed, or other central banks, printing trillions of dollars so easily and quickly prompts you.
Some even come to lose complete confidence in the United States dollar. The symbol of this historic loss of confidence in the global reserve currency is the decision by a significant number of Americans to buy Bitcoin with the stimulus check from $ 1,200 that they just received from the United States government.
These people see for the moment especially an incredible store of value in Bitcoin.
The fact that Bitcoin has transformed $ 1 invested at the start of 2010 in $ 90K at the end of 2019 has something to seduce. Likewise, Bitcoin continues to be the best performing asset since the beginning of 2020. Far ahead of gold, which has been a safe haven in times of crisis recognized for decades.
However, Bitcoin is still a plan B for people in Western countries. Rather a curiosity than a real necessity.
The situation is different for people in emerging countries
Leaving the richest countries in the world to go and see what is happening in the emerging countries under authoritarian rule, we realize that Bitcoin has already passed from the status of curiosity to that of vital necessity.
If you don’t follow the economic news of the world, you may not have seen what happened in Iran at the beginning of May.
Still, this is something that should grab your attention, as it could very well end up happening in Europe, or the United States. Nothing seems impossible in this world where everything turns upside down now.
To those who doubt it, I would like to remind them that American oil has sold to – $ 38 when the contract expires from May to the end of April 2020.
Nowadays, the impossible can become possible with a fiat system that no longer works at all.
Here I invite you for a quick trip in Iran.
The hyperinflation ravaging Iran is a telling example
In 2018,Trump administration made the controversial decision to repudiate the Iranian nuclear deal in July 2015. By reimposing extremely harsh economic sanctions on Iran, the United States wanted to bend the authoritarian regime in place.
The American strategy has still not worked, and it is the Iranians who are paying the price today.
Since 2018, the value of the Iranian rial keeps falling. He lost nearly 60% of its value. At the beginning of 2020, the situation was therefore already very precarious since the government of Iran had already been planning for several months to devalue its currency by removing four zeros from its face value.
The coronavirus pandemic then started, making Iran one of the hardest hit countries.
The requirement to impose strict containment across the country has ended up plunging Iran’s economy into utter chaos.
On Monday May 4, 2020, the Iranian government therefore chose to apply the bill presented in 2019 by the governor of the Iranian central bank, Abdolnasser Hemati.
This bill authorizes the replacement of the Iranian rial with another basic unit of local currency called the toman. From now on, each toman will be worth 10,000 rials under the new system.
Concretely, this amounts to removing four zeros from the nominal value of the Iranian rial.
Overnight, all Iranian citizens therefore see their wealth devalued without having any say in it. Government spokesperson, Ali Rabiei, commented on this decision on Twitter with this simple sentence:
“The elimination of the four zeros is a necessary measure to simplify financial transactions.”
Ali Rabiei, Iranian government spokesperson
A bill had already been introduced in 2019 by the governor of the central bank of Iran. He noted that local currency had already been devalued 3,500 times since 1971.
Inflation figures in Iran since 1984 easily confirm the hyperinflation situation the country has been in for several decades:
For many observers, this change of currency is only a simple cosmetic facade. It will not change the situation of extreme poverty in which millions of Iranians are plunged.
Even worse, for Iranian economist Saeed Laylaz, it should even worsen inflation in the coming months :
“The currency change and the elimination of too many zeros will inadvertently create unnecessary fluctuations in economic and social structures and even fuel inflation. The central bank will cut four zeros, but inflation will quickly bring two back. ”
By this arbitrary decision, the Iranian government will therefore further impoverish a population that has almost no alternative.
Bitcoin is already a necessity for millions of people
I mean almost here. In reality, many Iranians have been in the habit of buying Bitcoin for many months now. For them, the Bitcoin is the only bulwark against the hyperinflation induced by the monetary policy of their rulers.
Those who have been able to buy enough Bitcoins will be able to protect themselves from this massive devaluation.
Like what we are witnessing at Venezuela, where the number of merchants supporting Bitcoin as a means of payment is probably the highest in the world, more and more Iranian merchants will come to offer Bitcoin as a means of payment to help people protect themselves as much as possible against the hyperinflation that is ravaging the country.
Now that I have just described the dire situation in Iran where hyperinflation is taking its toll, you must be wondering where I am going with Bitcoin.
It’s very simple. In the future, your country’s governments may come to similar decisions. The American government could for example decide in the future that $ 10 are only worth $ 1. In Europe too, this risk is very real.
You think it impossible, but think carefully, who could prevent them? The answer is: nobody!
So far, no one thought the Fed could print several trillion dollars in a few weeks while declaring that she could print endlessly. Who would have thought that American oil, which is something tangible, could trade negatively?
From my point of view, the current monetary and financial system has failed in its mission.
Created de facto by Richard Nixon in August 1971, when it ended the convertibility of the American dollar into gold, this system could not continue as long without serious changes in the future.
I doubt, however, that the powerful at the head of this system have the will to question everything. They know that this system is not the right one, but they will not have the courage to change it.
In the future, you have great things to be impacted as strongly as the Iranians.
The main difference between you and the inhabitants of emerging countries is that you still have the choice to opt for Bitcoin.
People in emerging countries have no choice. They must necessarily switch to Bitcoin which is a great plan A for them.
By choosing to opt for Bitcoin faster than others, you will necessarily have an advantage over those who will come later. It’s logic. Those who make the right decisions before others are the ones who will benefit the most in the end.
As always, you are the only one who can take care of your future. It’s up to you to educate yourself to make the best possible decisions. For me, Bitcoin is clearly one of them and constitutes the ultimate bulwark against the hyperinflation which threatens the world more than ever in 2020.
Developer by training, I discovered Bitcoin in 2014 but I did not immediately understand the importance it could have for the world of tomorrow. I got into it more deeply from the start of 2017 and since then I haven’t given up on the business.
Passionate about Bitcoin and the new system it is trying to build for the future, I decided to participate in its evangelism at my modest level by writing on Bitcoin, Blockchain and crypto currencies on different supports.
It is with pleasure that I publish some of my texts in French on The Coin Tribune.
I also write a lot about personal development and self-improvement.
Do not hesitate to exchange with me via social networks or in comments on my articles if you have questions about my articles.