The merits of bitcoin lie not in the Winklevoss brother’s bid for a bitcoin ETF, which was met with scepticism from industry. If the brothers had it their way, which is still quite possible, they could well be the next multi-billionaires in a class of their own.
That’s the news for the $2tn market for exchange traded funds recently. However, over in South America, there is a tidal wave of capital flight out of Argentina that is causing President Cristina Fernández de Kirchner to implement her “laundering laws” for those undeclared dollars (see related article “a fistful of financial instrument”). This is because many of Argentines are flocking to the greenback in the black market. They have a preference (AIP) for the dollar more than the pesos due to the high inflation – ~20% to 25%. Some have even resort to using bitcoin for alternative measures. But what is the difference?
For the uninitiated, bitcoin is a digital currency. The supporters of bitcoin are dreaming to reinvent the financial system based around a currency not issued by governments and not subject to the whims of central banks, while the authorities (mostly governments) are calling the alternative currency a bank for global criminals. However if you probe into the plight of the Argentines, law-abiding or criminals, I would probably do the same when my country’s inflation rate skyrocketed. The short film below will probably tell you more about the merits of the digital currency.
For beginners, this is a good website to start if you want to get acquainted with bitcoin. For those who are more technically inclined (smarter), the Khan Academy offers a good site for you to study what bitcoin is.
- Bitcoin a Refuge For Argentines Tired of Government’s Currency Despotism (reason.com)
- Argentina Bitcoin Adoption Jumps in Recent Months – Report (onbitcoin.com)
- A fistful of financial instruments (economist.com)