Since 2020 they have had a vertiginous price growth, so far this year the fall has plummeted and the future of these digital assets is not clear.
Cryptocurrencies continue to generate deep controversy since their vertiginous price growth since 2020. So far this year the fall has been sharp and the future of these digital assets is not clear.
The questions end up being the same. Will they manage to transform into a mature technology and become part of the finance mainstream? Or will they go down in the history of innovation as the pretty solution to a problem that doesn’t exist (in particular, the demand for decentralization of society)?
Against Cryptocurrencies… Or Not?
Great critics and great defenders take advantage of each of the news with cryptocurrencies to strengthen their positions. For example, skeptics use data that is devastating. El Salvador is one of the first countries in the world to declare Bitcoin as legal tender. They claim that the country is facing a situation of bankruptcy and debt crisis.
The president of El Salvador, Nayib Bukele, has tried in recent years to portray himself as one of the great entrepreneurs and visionaries of Silicon Valley. It got the country to buy Bitcoin to add to its international reserves, encouraged companies from around the world to settle on its land to develop Blockchain innovation, and encouraged the population to use cryptocurrencies as a form of savings and to make retail purchases.
However, the idea of acquiring Bitcoin at values of 40 thousand dollars now that it costs close to 20 thousand does not seem to have been the timeliest, mainly if the state of the country’s financial accounts is taken into account.
The situation is so pressing that the International Institute of Finance carried out a special report on El Salvador this month, stating that the debt is unsustainable, reserves are running out quickly, pension funds are being drained and by 2023 the scenario is chaotic.
For Cryptocurrencies
Cryptocurrency optimists do not ponder negative news but notice more auspicious events for the sector. For example, the global finance empire BlackRock offered a boost to Bitcoin in recent weeks, incorporating the option to trade this digital currency on its Aladdin asset management platform (on which trillions of dollars are moved). It was a milestone in the financial industry and investment funds.
The news does not come only from the United States. Last week, the announcement of the Brazilian unit of Mercado Libre making the launch of Mercado Coin official was surprising. This is the first version of the digital currency of the e-commerce giant in the region, developed with Blockchain technology (on the Ethereum network) and with the intention of reaching all of Latin America.
It would be used as a user loyalty mechanism. In other words, every time a product is purchased in Mercado Libre Brasil, prizes will be received in this digital currency. But it is scheduled to offer the possibility of buying, saving, and transferring from the Mercado Pago platform.
The project is currently in the initial phase. The expectations that are generated may not materialize in reality. That happened with Facebook’s digital currency idea when it announced Libra and then Diem.
By Audy Castaneda
