{"id":8500,"date":"2021-06-20T17:54:18","date_gmt":"2021-06-20T17:54:18","guid":{"rendered":"https:\/\/www.buyucoin.com\/crypto-labs\/economist-steve-hanke-warns-salvadoran-bitcoin-adoption-could-completely-collapse-the-economy\/"},"modified":"2021-06-20T17:54:18","modified_gmt":"2021-06-20T17:54:18","slug":"economist-steve-hanke-warns-salvadoran-bitcoin-adoption-could-completely-collapse-the-economy","status":"publish","type":"post","link":"https:\/\/www.buyucoin.com\/crypto-labs\/economist-steve-hanke-warns-salvadoran-bitcoin-adoption-could-completely-collapse-the-economy\/","title":{"rendered":"Economist Steve Hanke Warns Salvadoran Bitcoin Adoption Could \u2018Completely Collapse the Economy\u2019"},"content":{"rendered":"

The professor of applied economics at Johns Hopkins University, Steve Hanke, has recently been criticizing bitcoin adoption taking place in El Salvador. Hanke doesn\u2019t think it\u2019s a good idea for the Latin American country to use bitcoin as legal tender and says it could \u201ccompletely collapse the economy.\u201d<\/strong><\/p>\n

Steve Hanke Wants Countries to Adopt Currency Boards Instead of Gravitating Toward Bitcoin Adoption<\/h2>\n

The American economist Steve Hanke knows a lot about currencies, as he is the Cato Institute\u2019s senior fellow and director of the Troubled Currencies Project. Hanke also was the senior economist during the Reagan administration from 1981 to 1982. The economist is critical of central banking and noted<\/a> in 2018 that the world could use less of them. At the time, Hanke highlighted ten countries that are suffering from hyperinflation and the economist proposed that the countries either adopt the U.S. dollar or create a currency board.<\/p>\n

\u201cCountries that employed currency boards have delivered lower inflation rates, smaller fiscal deficits, lower debt levels relative to the gross domestic product, fewer banking crises, and higher real growth rates than comparable countries that have employed central banks,\u201d Hanke said at the time.<\/p>\n

Fast forward to three years later, Hanke is now discussing bitcoin (BTC)<\/a> and the implications of widespread adoption. Hanke is not a fan of bitcoin and has mentioned this fact on numerous occasions. This past April, Hanke tweeted<\/a>: \u201cBitcoin bulls hate to discuss the flaws of bitcoin. Cryptocurrencies are the future of money. Bitcoin is not.\u201d The economist also shared an article he wrote, which stresses the use of currency boards over bitcoin.<\/p>\n

In the article<\/a>, Hanke talks about the monetary luminary Milton Friedman and Hanke also said he believes bitcoin comes with a \u201cfundamental value of zero.\u201d Hanke is once again attacking bitcoin after finding out that El Salvador would be leveraging bitcoin as legal tender<\/a> in the Latin American country. Hanke thinks that nations like China or Russia could use El Salvador to cash out and remove USD from the equation.<\/p>\n

\u201cIt has the potential to completely collapse the economy because all the dollars in El Salvador could be vacuumed up, and there\u2019d be no money in the country. They don\u2019t have a domestic currency. You\u2019re not going to pay for your taxi ride with a Bitcoin. It\u2019s ridiculous [\u2026] You\u2019ve got 70% of the people in El Salvador don\u2019t even have bank accounts, Hanke stressed during an interview<\/a> with Kitco\u2019s David Lin. Hanke continued:<\/p>\n

The big problem with cryptos, in general, is that you can\u2019t convert them into actual real legal tender that\u2019s usable cheaply, and quickly. You can\u2019t Bitcoin, for example, cheaply and easily convert into U.S. dollars.<\/p>\n

<\/p>\n

Nigeria Should Not Follow El Salvador\u2019s Footsteps Says Hanke<\/h2>\n

Following the economists\u2019 statements with Kitco\u2019s David Lin, Hanke also shared an article<\/a> on Twitter written by Bitcoin.com News author Terence Zimwara<\/a>. The article explains how the Central Bank of Nigeria (CBN) has been discussing the country leveraging a digital currency by the year\u2019s end. Hanke did not like this assessment from the CBN and said if it was like El Salvador\u2019s idea, it would likely lead to ruin. Hanke tweeted:<\/p>\n

If Nigeria\u2019s plans for a digital currency is anything like El Salvador\u2019s Bitcoin plan, it will FAIL. Instead of toying with nutty ideas, Nigeria needs to establish a USD-denominated Currency Board, like the one it had between 1913-1959.<\/p>\n

Zimbabwean fintech lawyer and crypto proponent Prosper Mwedzi<\/a> responded to Hanke\u2019s statement about Nigeria and said<\/a>: \u201cI think a digital currency for Nigeria could improve bc access to financial services depending on [the] design.\u201d Further, a number of others disagreed with Hanke\u2019s commentary and replied to his scathing Nigeria\/bitcoin tweet.<\/p>\n

\u201cHanke only has a hammer (USD Currency Board) so to him, everything looks like a nail,\u201d another individual wrote<\/a>. \u201cBitcoin has no such restrictions and will keep saving weak economies,\u201d the person added.<\/p>\n

What do you think about Steve Hanke\u2019s commentary about El Salvador and Nigeria? Let us know what you think about this subject in the comments section below.<\/strong><\/em><\/p>\n

Bitcoin News
\nEconomics, Bitcoin, Bitcoin adoption, BTC, Currency Board, Currency Boards, David Lin, economics, Economist, Economy, El Salvador, Kitco Interview, Nigeria, Prosper Mwedzi, Salvadoran, Steve Hanke, Terence Zimwara, U.S. Dollars, USD<\/p>\n","protected":false},"excerpt":{"rendered":"

The professor of applied economics at Johns Hopkins University, Steve Hanke, has recently been criticizing bitcoin adoption taking place in El Salvador. Hanke doesn\u2019t think it\u2019s a good idea for the Latin American country to use bitcoin as legal tender and says it could \u201ccompletely collapse the economy.\u201d Steve Hanke Wants Countries to Adopt Currency…<\/p>\n","protected":false},"author":0,"featured_media":8501,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[53,3],"tags":[],"class_list":["post-8500","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blockchain-news","category-coin-news"],"_links":{"self":[{"href":"https:\/\/www.buyucoin.com\/crypto-labs\/wp-json\/wp\/v2\/posts\/8500"}],"collection":[{"href":"https:\/\/www.buyucoin.com\/crypto-labs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.buyucoin.com\/crypto-labs\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/www.buyucoin.com\/crypto-labs\/wp-json\/wp\/v2\/comments?post=8500"}],"version-history":[{"count":0,"href":"https:\/\/www.buyucoin.com\/crypto-labs\/wp-json\/wp\/v2\/posts\/8500\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.buyucoin.com\/crypto-labs\/wp-json\/wp\/v2\/media\/8501"}],"wp:attachment":[{"href":"https:\/\/www.buyucoin.com\/crypto-labs\/wp-json\/wp\/v2\/media?parent=8500"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.buyucoin.com\/crypto-labs\/wp-json\/wp\/v2\/categories?post=8500"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.buyucoin.com\/crypto-labs\/wp-json\/wp\/v2\/tags?post=8500"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}