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Bitcoin's Role in Combatting Inflation

Sun, 04 May 2014 04:12:05 GMT

By Jon Matonis CoinDesk Saturday, April 26, 2014 The economies of the developing world will feel the earliest and greatest impact from bitcoin. Not only are bitcoin’s enormous benefits very personal, they are also contextual depending on your political geography. Individuals residing in high-inflation countries with relatively sufficient Internet access as a percentage of population do seek refuge in bitcoin. The worst offenders depriving their subjects of monetary stability or a reasonable – albeit ‘coerced’ – store of value are the dictatorial regimes in politically tumultuous countries like Belarus, Sudan, Syria, Iran, Ethiopia, Malawi, Venezuela, Burundi, Yemen, and Tanzania. Incidentally, those countries also form the top 10 country list for annual inflation rate according to the World Bank and International Monetary Fund data for 2012. High-inflation promotes bitcoinTopping the list is Ukraine’s neighbour Belarus, with an annual inflation rate of 59.2%. Ruled by President Alexander Lukashenko since 1994, Belarus is known as Europe’s last dictatorship. While shocking, that inflation rate is actually down from 2011, when a financial crisis triggered a peak rate of 109%. Venezuela comes in at #7 worldwide, with an annual inflation rate of 21.1%. Price controls, capital flight, food shortages, and electricity blackouts are now pushing Venezuela toward the brink. The Heritage Foundation’s Index...

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