This is an opinion editorial by Jiro Reyes, CEO of Bitskwela, a Philippines-based education company focused on accelerating the country’s local Bitcoin adoption.
Corruption, poverty and financial exclusion. These are just a few of the many problems that Bitcoin was created to solve. But many countries to this day still have most of their citizens fighting for their lives, or rather, fighting these issues for the rest of their lives.
One such nation to take note of is the Philippines, a developing country in Southeast Asia.
The need for Bitcoin in the Philippines
Bitcoin is often said to offer a solution to various financial issues, and there are many plaguing the Philippines. It has a criminally high statistic of more than one fifth of the population (23.7%) living below the poverty line. Furthermore, the country has 10 million citizens who remain without banks and it is also number 117 out of the 180 most corrupt countries, which causes problems when they rely on centralized authorities to make decisions.
Not surprisingly, today it has not been spared from the interconnected and ever-growing economic crises around the world. Just like in the US, the COVID-19 pandemic has caused the Philippines to impose heavy lockdowns that have lasted much longer than those of most other countries. As a result, the country’s GDP shrank by 9.6% and the economy has yet to recover. Inflation in the country has also become an issue, with quantitative easing and supply chain issues following the pandemic. Philippines savings are unable to keep up with the prices of goods and this is further exacerbated with the wide range of fiat currencies losing value against the dollar due to interest rate hikes by the Federal Reserve System. With the majority of Filipino citizens struggling with a minimum wage of 570 pesos, or $9.65 per day, it becomes imperative to find a better way to gain financial security. Enter Bitcoin.
How Bitcoin Solves Issues in the Philippines
With Bitcoin being the most open source, secure, immutable and decentralized form of money, the majority of the economic problems facing Filipinos can be addressed through its adoption. It would help the 10 million unbanked Filipino citizens become their own banks. There will no longer be a need for tedious applications or the collection of various IDs and documents. Anyone can store and send money simply by using a phone and internet connection. Final inclusion is a given with Bitcoin.
Bitcoin transactions also help reduce corruption, which is common in the Philippines, and overall criminal activity. Since all transactions are publicly visible on the blockchain, it becomes easier in some ways to detect suspicious activity and track down bad actors in the system. The fact that Bitcoin is decentralized also ensures that no single government or bank controls it, nor can any third party censor or prevent transactions from going through.
Even inflation and the Philippine peso’s weakening purchasing power can be fixed with Bitcoin. Due to a fixed supply of 21 million, it is certain that there will never be more bitcoin than that amount in existence, thus making it deflationary. Bitcoin will not lose value over time simply because of some government pushing harder or a random gold mine find. It is the perfect store of value and inflation hedge to protect one’s purchasing power over time.
Solving problems like this shows how Bitcoin can help struggling ordinary people, not only in the Philippines, but all over the world.
The need for better Bitcoin education
Despite the fact that Bitcoin can solve many problems in the Philippines, it is still necessary to link its adoption with appropriate education. This is to ensure that the people using it are able to maximize Bitcoin to its full potential and avoid financial harm.
For example, the Philippines has had several scams in the past that invoked the promises of bitcoin to lure victims. Many people probably fell for this scam and may now have a deep distrust of Bitcoin and cryptocurrency as a whole.
In my experience, there is also a lack of a “research” mentality among Filipinos. They will often just buy what their friends and family say without understanding it. It can also be accompanied by an expectation of quick profits all the time and a lack of HODLing. If they don’t really know what they are investing in, they may panic and sell something like bitcoin at a huge loss when the price turns against them. On the other end of the spectrum, I fear that the majority of Filipinos won’t even invest, be it with bitcoin or anything else, because of the lack of an “investment mindset” in the country. Many will miss out on working towards financial security and freedom as the concepts of fiat depreciation and inflation are foreign to them.
Finally, there is also the simple language barrier in that most Bitcoin education is offered in English and not in Filipinos’ native language. This also comes with the fact that there is a lot of technical jargon to learn about blockchain technology. Although some education platforms are already tackling this in the country, it is still a relevant issue to highlight.
This idea of the need for adequate education is not only limited to the Philippines, but also extends to all other countries that Bitcoin will eventually penetrate. Each country will have its own unique problems in learning about Bitcoin, so it becomes important to identify each problem per country and then tackle it accordingly.
Interest in Bitcoin and the opportunities it offers
Nevertheless, there are numerous opportunities for the development and adoption of Bitcoin. Although countries like the Philippines will inevitably face some obstacles in Bitcoin education, most citizens become quite accepting and eager to learn once they are trained. The Philippines, in particular, shows a lot of promise.
When it comes to opportunities, the Filipino people are avid internet users, with the country being called the “social media capital” of the world. Inevitably, this also led to the country’s relatively high Bitcoin and cryptocurrency adoption. GWI’s global survey revealed that the Philippines was ranked the second country in terms of cryptocurrency ownership and another survey showed that bitcoin was the most popular cryptocurrency in the country, with 37.8 % of the 12 million cryptocurrency owners out there holding bitcoin in their wallets. The governor of the Bangko Sentral ng Pilipinas, the country’s central bank, has indicated that there are no plans to ban the use of cryptocurrencies. Bitcoin education is also a growing trend there.
Many other countries, especially developing countries, will show similar promises. Realizing this promise simply requires an adequate understanding of economic problems and how to utilize mass education. The case of the Philippines shows how, despite numerous disadvantages in a government or economy, Bitcoin can still alleviate some problems for ordinary citizens. Bitcoin shows that even though there will be obstacles in the education process, breakthroughs to the people will bring great opportunities.
This is a guest post by Jiro Reyes. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
