John Jacques's Avatar
published in Blogs
Sep 21, 2018

Are Currency Crises Leading to “Hyperbitcoinization”?

Currency crises, precipitated by economic woes, have become everyday realities in Venezuela, Turkey, Iran, Zimbabwe, and other Emerging Market countries. With fiat currency in each country significantly devalued by inflation, limited by capital controls, or both, citizens have been turning to cryptocurrencies as a dependable store of value and means of exchange.

Cryptocurrency enthusiasts are, in turn, excited by the prospects for blanket adoption in those countries and elsewhere – a process called ‘hyperbitcoinization,’s which signifies the point where people exit fiat currency for bitcoin after extensive fiat devaluation. Others have tempered their enthusiasm, convinced that the relative isolation of these occurrences means adoption has little chance to spread outward.

Venezuelans have turned to crypto in increasing numbers, driven by both extraordinary inflation and capital controls imposed by the government in 2003 that make it difficult to obtain US dollars. Data is inconsistent, making exact numbers difficult to come by, but trading has increased gradually since 2014. Numbers aren’t massive, but “the Bitcoin market in Venezuela is indeed big and growing at a fast rate,” says Randy Brito, founder of Bitcoin Venezuela. The oil-backed, state-introduced cryptocurrency ‘Petro’ has failed to gain much traction, but the use of Bitcoin and other cryptocurrencies, like Dash, continue to grow. More than 540 merchants accept the latter, known for quicker confirmation times and lower fees.

Iran has also felt the effect of sanctions, with their currency, the rial, hovering around roughly 18 percent inflation. The government announced plans for a state-run cryptocurrency, and as Forbes reported in May, Iranian residents had traded $2.5 billion in crypto despite an April ban on banks working with digital currencies. Data indicate, however, that inflation is not enough to spur mass crypto adoption, as the Iranian market is hamstrung by government-sanctioned bank bans.

Turkey has endured similar inflation woes (roughly 12 percent in October 2017, since rising to 15.39 percent as of July) resulting from a variety of issues. Adoption was initially not as significant as expected for a country of Turkey’s GDP size, but a recent 131.9 percent increase in trade volume on the LocalBitcoins exchange from July to August (the result of Turkish citizens noting Bitcoin’s resilience in the constantly-fluctuating crypto market), coupled with an ING survey indicating that 18 percent of Turkish people own cryptocurrency – the highest rate in the world – means that seems to be changing.

Zimbabwe abandoned its national currency in 2009, after 10 years of rampant hyperinflation; its government initially permitted the use of certain foreign currencies before introducing capital controls in May. The Zimbabwean Golix exchange has seen price increases exceeding the global average since the end of 2017 as Zimbabweans searched for a currency without government controls. November saw it quadruple its number of monthly transactions following a fresh round of destabilization, with monthly trade volume increasing tenfold from all of 2016 to $1 million.

It appears that, despite significant difficulties facing each country, inflation alone isn’t enough to drive hyberbitcoinization – at least for now. Cryptocurrencies retain huge potential during financial crises but seem unlikely to gain mass adoption on that level while the US dollar and the euro remain strong. But, to the delight of crypto enthusiasts, each is proving their worth in tough economic times, while providing a blueprint for future adoption.
 

Looking for Fresh Forex and Crypto Investment Ideas? See How A.I. Can Help

Investing in Emerging Markets currencies, and/or cryptocurrencies, is risky and should involve plenty of due diligence. That being said, the price fluctuations in both assets can create opportunities for traders to take advantage. The question is, how can you track the wild price movements and get trade ideas from them?

Artificial Intelligence can help. Tickeron has developed user-friendly Artificial Intelligence capable of spotting patterns and trends in the cryptocurrency markets, and the A.I. can deliver trade ideas straight to your inbox. When the AI confirms a bullish or bearish pattern, it will alert users to the pattern and provide a target price for where it thinks the cryptocurrency is headed. Users can use the AI to track just about any cryptocurrency of your choice.

You can learn more and even start a 45-day free trial today. Get started on tickeron.com.

Related Tickers: BTC.X
Sergey Savastiouk's Avatar
published in Blogs
Mar 14, 2023
How to Start Trading Penny Stocks

How to Start Trading Penny Stocks

Penny stocks have long been marginalized within the professional investment community, oftentimes being painted with a broad brush of simply being “too risky.” Leonardo DiCaprio’s depiction of the penny stock peddling conman, Jordan Belfort, in the Wolf of Wall Street certainly didn’t help.Here are four reasons to start trading them now. Reason #1: Let’s State the Obvious -- Penny Stocks are Cheap A single share of Apple Inc. costs over $350.
Dmitry Perepelkin's Avatar
published in Blogs
Mar 14, 2023
5 Habits that Lead to Successful Investing

5 Habits that Lead to Successful Investing

To consistently make money in this industry, you need emotional fortitude, an analytical mind, and a willingness to self-reflect. Despite trading and investing being two different activities, these principles can be applied to both.Conversely, investors with good habits often become great traders.  Rather than full sentences for titles, we’ve labeled each of our top-five investing habits using a single word principle.
Sergey Savastiouk's Avatar
published in Blogs
Mar 13, 2023
4 Tips for Fast, Effective Stock Analysis

4 Tips for Fast, Effective Stock Analysis

With just a few clicks, an investor can search for individual stocks, categories of stocks, sectors, or investment themes, and then he or she can conduct a full range of technical and fundamental analysis within seconds.All powered by Artificial Intelligence.  Below, we give you 5 tips for fast, effective stock analysis using Tickeron’s Screener.
Sergey Savastiouk's Avatar
published in Blogs
Mar 20, 2023
5 Golden Principles in Investing

5 Golden Principles in Investing

You have enough faith in that stock, based on research, that the return will equal or exceed the investment.  Do unto others.The principles outlined here will ensure that happens.  Principle #1: Diversification Investors can’t be one-dimensional when constructing a portfolio.
Sergey Savastiouk's Avatar
published in Blogs
Mar 15, 2023
The five most important Lessons Learned After 10,000 hours of Trading
Edward Flores's Avatar
published in Blogs
Mar 12, 2023
What's the Difference Between Tokens and Altcoins?

What's the Difference Between Tokens and Altcoins?

Between their inherently technical nature, multiple varieties and sub-varieties, and endless terminology, cryptocurrency (defined here as digital or virtual currencies that are encrypted using cryptography, powered by the immutable digital ledger known as the blockchain) represents a whole, complex world.All altcoins possess their own blockchain, independent from their source code, that records all transactions of their native coins. Many altcoins are variants, or forks, of Bitcoin that leverage that cryptocurrency’s open-source protocol as the basis.
Edward Flores's Avatar
published in Blogs
Mar 15, 2023
4 Ways to Save for Retirement Without a 401(k)

4 Ways to Save for Retirement Without a 401(k)

401(k) plans are attractive savings options for good reasons: tax breaks, potential employer matching, and access to growth investments.Roth IRA contributions are made in after-tax dollars, and withdrawals for account owners age 59 ½ or older are tax free (if the account is at least five years old). Investors with an individual adjusted gross income below $32,000 can even claim between 10 and 50 percent of contributions as a saver’s tax credit.
Sarah Patel's Avatar
published in Blogs
Mar 22, 2022
Nike (NKE, $130.03) beats fiscal Q3 earnings expectations
Sergey Savastiouk's Avatar
published in Blogs
Mar 16, 2023
Artificial Intelligence for Language Translation?

Artificial Intelligence for Language Translation?

Some use cases – predicting earthquakes, recognizing objects, and comparing medical scans, for example – offer tantalizing glimpses of a promising future.Now, MIT researchers have announced an “unsupervised” language translation model whose early returns signal a future with “faster, more efficient computer-based translations of far more languages.” Most widely-used translation programs (like Google’s) learn via models.
Lester Daniels's Avatar
published in Blogs
Mar 15, 2023
How Artificial Intelligence Can Boost your Trading Results