Bitcoin Forum

Most of the third world country hold their foreign reserve  in dollar. Do you think any of these third world country will accept Bitcoin and equally holds their foreign reserve in bitcoin instead of dollar form? In your own opinion what do you think will happen to such economy both in terms of positive and negative effects?

That will have positive economy results.Like example for Europe countries will be good because if America have less power than Europe can get that power and more money and better economy.

Dollar is what is affecting development in most of the third world currencies. I keep on saying that the only way to destroy the strength of dollars on the third  world countries' currencies is by using bitcoin as a gold standard for their individual country currency.

This will never happen. Third world countries become dependent on the U.S. dollar due loans at very low interest rates. Who will they lend in bitcoins? Besides, no one will take a loan in an unstable currency. It is very dangerous.

yes that is very right and i think most of the backward countries may have  no such idea about bitcoin, i think most of the backward countries are taking loan from USA in Dollar form, which they for them most of time do not capable to return, they are every running their countries on foreign donations and loan. and if the donors will stop their donation for them, i do not think that they will survive for a long time.

Nope. Why would they do so? Foreign reserves are meant to protect their country against a crisis.
If Bitcoin drops suddenly, it could trigger a crisis.  :P

Do you know how's the third world countries population and economics? Maybe some of them knowing bitcoin, but not at all. Not all the people know bitcoin, so how it can give massive impact? I think it's just a little bit confused.

Is this yet another thread where we will no longer see OP?

Nevertheless, it is next to impossible that countries which hold their reserves in dollars (personally, though, I wouldn't call Japan as a third world country) would switch to buying up bitcoins. Bitcoin is just too marginal for that, it is not even traded on major exchanges (read it is still considered too outlandish by the financial world). Apart from that, countries don't keep the American dollars as such, they stash the US government bonds (Treasuries) on which they receive interest paid by the US government

It will be a good development if the third world countries hold their reserve in Bitcoin this will curtail the  influence of world economies on US dollar. The chinese had been trying to do that using yen if bitcoin is globally accepted then it will be easier to reserve their money in bitcoin.

I don’t think so, would you store something that in theory could be very easy to steal, storing gold, has its issues but stealing gold is difficult because you need to transport a lot of tons of gold, storing dollars is not complicated but even if someone stole them you could always track them or reverse the transaction if it was electronic.

I don't think so. After all, we're third world, not a lot of people even know about this, much less the gov't, which were pretty late to the party. They probably only released guidelines fearing it'll be used to launder money. Besides, like many here pointed out, it's still quite unstable. The increase in price might look attractive but what happens when it crash?

That's equal (maybe even worse) to Iraq converting it's foreign currency reserves to Euro before the US invaded to restore the order :)

Best case scenario I can see is a middle to upper class (in terms of GDP) country converting up to 10~20% of their gold stash into Bitcoin in 10 years from now. The prime reason about that would be the beginning of the space mining industry. A relatively "small" space rock would be enough to inflate the precious metal market enough to convince a country to switch some of their stash into Bitcoin ;)  You can't find Bitcoins in space! 

The dollar has big domination for the fiat currency. That's why the 3rd countries are using it to hold their foreign reserve. But if the bitcoin can make a domination to the dollar and i can say if that will be possible in the future.

We know that the price of bitcoin will always be increasing every time and it will make the bitcoin has a big deal with the dollar exchange. That will bring more on the economic. that means if that will be a positive impact.

To a degree one might say iceland experimented with this concept via introducing aurora coin.

Russia too could be experimenting with this with their announced plans of creating a national crypto currency.

One might say: it is already happening.

Most nations are getting into crypto, except for the united states which appears determined to dwell in the currency dark ages forever.

As america is the "best country in the whole world" and thus is exempt from keeping up with emerging technologies or innovations.

Yeah, no third world country is holding bitcoin right now and I do believe that some of them dont even know what BItcoin is and what they can do with bitcoin. Moreover, those countries do not have enought technology and knowledge to understand deeply about bitcoin. Therefore, don't expect that those countries will make a huge impact in the bitcoin price.

There is a report in my country Philippines that the national bank is accepting btc but i dont really have a full speculation about it. It seems that the bank will accept it as a means of payment for any transaction that could take place in the bank. If there are any other Filipinos out there could you please clarify it. What i have in my mind is that you could pay loans directly with. I thought you could pay goods but it was just the bank that accepts it.

Hope you know that the reserve currencies are held in more than one currency and not in dollar alone.No country will be playing with their foreign reserves and they wont take any unnecessary risks as it could hurt their growth and it could lead to a huge debt and the main reason they wont accept bitcoin is simply because of its volatility and the price fluctuations is really huge to be accepted as a reserve currency.

I don't know how far Governments in developing countries will go in order to stash Bitcoin but individuals and companies will do that by default as many don't have access to traditional banking services but mobile technology is getting everywhere and is more affordable. I think many young people with access to mobile phones will be hoarding bitcoin and looking for ways to earn it for free as they have no access to the traditional work market and banking.

I doubt if any third world country will be able to take that risk simply because of no other reason than volatility that in the case of bitcoin crashes, then they become poorer in which case they have no alternative which is the most scary part. Another reason is that based on the level of technological development in such country, I wonder how they will be able to adopt bitcoin and also most of this countries relies on foreign aid from the United States and the moment they change then they might be losing from both ends.

Not all countries in the third world are fans of dollars. They have their own financial policy and most hold their reserves  in real Gold. But in near future we can expect or at least personally I would love to see all countries holding their wealth in bitcoins - of course all countries have to first officially accept and come to a consensus on it.

I do believe for some African countries, bitcoin must suit as a national currency rather than just a foreign reserve. Because bitcoin seemed stable compared to their rapidly falling local currencies.

I believe at least Zimbabve should try investing in Bitcoin.. if I were in their government I'd try swtiching to BTC instead of their mostly worthless currency

Lol I understand you, the fact is that such a country as Zimbabwe has nothing to lose and therefore it will be possible to take risks and invest in Bitcoin. But it will be very difficult for other countries to do and incredible even if this happens.

At the current status of bitcoin, i think not yet. Unlike the dollar, i btc isn't yet hat established and countries may be favoring gold or oil rather than btc. I can't tell anything about the future but for btc i think countries are not yet thinking about it

It is not just about volatility

Unlike real gold in underground vaults, bitcoins can be easily stolen as it happened in the past with so many well known and popular exchanges (e.g. Bitfinex). Therefore, if a government is incompetent in setting up their monetary policies which lead to severe currency devaluations and abandonment of local currency (like it happened in Zimbabwe), we shouldn't in fact expect too much from them regarding security questions either. I guess it would be a really traumatic experience for the population of some country if its Bitcoin reserves got stolen one day

For sure they wont survive and most 3rd world countries do really depend on US which they cant really easily turn their back on it since they are being dependent for a quiet longer period of years already and also Bitcoin might be a solution but considering on the value of bitcoin and usage it would really be limited and they cant really pay up their debts on bitcoin.Thats why its really impossible for this thing to happen.

Zimbabwe currently has a lot of investors that are seriously investing into bitcoin and others crypto currencies and most of them are now millionaires in Zimbabwe currency. Like I said before African can only  reduce the values of dollars on the currencies by buy into crypto currencies.

Maybe someday bitcoin can be a foreign exchange in some developed countries because seen from 2009 to 2017, 8 years is not a long time but bitcoin able to continue to grow quickly without us realize almost the same as the value of gold. Because many countries dare to get out of dollars so do not be ruled out if bitcoin can also beat the dollar in the future.

I don't know if crypto is suitable for state reserve currencies. Governments typically prefer currencies they have direct control over.

Where crypto is useful is ensuring the average person can maintain the value of their wealth if hyperinflation occurs, contributing towards less suffering over the long term for everyone, both rich and poor.

Its an integral part of the economic debate which claims a strong middle class is necessary for a good economy which many have said is one thing china lacks and needs.

I wish that countries can hear this man. The problem right now is that third world countries are mainly exporting countries and are not importing - which means that the US basically buys everything they produce and pay in newly printed US dollars. This is a big problem and creates basically a dilemma.

The exporting country endsu p with a pile of paper, and if they decide to sell this currency then it'll make their own currency worth more and the US dollar worth less. This isn't what they want, as they don't want to inflate the price of their own currency to make their products less competitive nor do they want the rest of their US dollars to be worth less.

By buying into bitcoins, they're not making their national currency worth more which means that their exports stay competitive. They will also hold something that is decentralized and a great store of value.

Well, this is a very interesting way of looking at things. I mean, bitcoin is patterned after gold in that there's only a fixed quantity of the metal. This however didn't took into consideration metals that would be mined from asteroids. Now that I've thought about it, it's probably even possible that eventually, bitcoin would be rarer than gold!

External reserves to a large extent determines the strength of the internal currency of a country especially for an imlrt dependent economy like most of the third world countries and in which case needs a level of stability in their external reserves in other to grow gradually but they may not achieve that if bitcoin that is so volatile might distort their economic growth and even impoverish them the more in the case the volatily is on the negative.

In practice, though, things are entirely different

The third world countries you mention don't have dollar reserves at all, the dollars which they might receive from their exports are immediately stolen by the people who make up the government of such a country. Apart from that, Bitcoin is nowhere near being a good store of value, and exporting countries that do have dollar reserves (like China or Russia) are more inclined to buy gold, which you seem to have completely forgotten about

Forget replacing bitcoin there is not going to be a single country who is going to replace dollars with something else for foreign exchange as that would just leave us putting sanctions on that country and obviously all the puppet world leaders are going to follow them. Russia is surely a exception as they are the only one who can go against us and they have already introduced a new currency for foerign exchange.

You are correct but most of the reserve currencies are in dollars, but now more countries are using euros too, but the truth, is that the economies of the world are becoming even weaker as they become even more indebted as time passes, so all of these reserve currencies may become worthless overnight if we get into another great economic crises.

LoL. I do not think that this country will develop bitcoin in their currency system because no government will do that. They can not control the people if they let everyone use bitcoin. Moreover, I do not believe that everyone in Zimbabwe having a smartphone or computer

Very risky to store foreign exchange reserves in the form of bitcoin, unstable btcoin price makes it impossible, the economy of a country must be stable so that the price of basic needs is also stable, if the foreign exchange reserves use the currency is not stable then the money flow will be disrupted

But I think in the near future, it is possible for third world country to hold some part of their foreign reserve in bitcoin. The issues of volatility of Bitcoin price is another major point that call for concern, but the same volatility equally affects US dollar too. Am of the believe that the third world countries can hold about 25% - 30% of their foreign reserve in bitcoin for the fear of unknown that may likely affect their economy.

I truly believe that third world countries will hold a part of their resources in cryptocurrencies (not only BTC), as well as creating their own cryptocurrencies for local market to increase liquidity.
Dollar will still be a big player and about 30%-70% of portfolio will be held in dollar.
But everybody understands, that BTC is growing, and growing very fast, so its profitable to have such asset.

I don't think this is possible.  No government, even in third world countries, don't trust bitcoin that much that it would keep the reserve in it. And for that bitcoin should be regulated and accepted, full implemented in economy and that is still not very likely. And there is big volatility problem so  I don't think any country will go for that.

Also I would like to add that will require the public to trust the government, the Zimbabwean dollar is synonymous with a failed currency, so much , that most in Zimbabwe don’t use anything other than foreign currencies to do their trades and use currencies like the Us dollars, the euro, the Japanese yen, the Chinese yuan, the Australian dollar, the pound, maybe someone will use bitcoin but that will be because they want and not because the government imposes its will over them.

Keeping part of their foreign reserve in BTC would be amazing, beneficial and really progressive approach, too bad it won't happen anything soon.
Poor countries seek stability and USA is still the best country in the world to promise them that.
Bitcoin is not good because there is no one behind it, no one will guarantee that one day BTC's value will crash. In other words, it is too risky to focus on BTC alone.

I don't think Bitcoin will replace dollar as dollar has been around there for centuries and it is one of the most stable currencies in the world.bitcoin is not as stable as dollar. Moreover dollar is accepted everywhere and by everyone. But acceptance of Bitcoin is not as high as dollar so it would take years for Bitcoin to replace dollar.

Not at all, because the volatility will greatly affect the economy of the nation if the reserve is placed in the form of bitcoin. USD has got a stabilty in the value which doesn't make a big difference compared to bitcoin. Think of the bitcoin's current scenario where the price has fell more than 500$ in a short.

The volatility is what really makes them not to go with Bitcoin but rather to USD since it is stable and less risky considering that it has a great market and will not just magically one day be gone and lose value. Bitcoin on the other hand has a lot of risk which they can't rely their money on since in the world of cryptocurrencies, it is full of uncertainty.

For now I think in the third world countries, there are still many who keep their foreign exchange reserves using the dollar currency, why I say so, because until now the dollar is still very influential to meet the economy of each country, so in conclusion, bitcoin yet Able to compete with the dollar

I dont think so. It woud be a long long process. And since most or maybe all third world countries are depending on holding their foreign reserve in dollar, I dont think their government would risk into something that (not all their) citizen know. But if the government and its citizens would have a good knowledge about this then maybe it would give positive results but if not then they might end up losing everything

Now, Bitcoin is very new for more people, only small amount people on the world's have knowlegde use it and trust it, so not country want try use Bitcoin for do that, it very risk and spend more time for teach and guide people use Bitcoin, because if not have knowledge they can't use it and protect their property

You are correct, there is not a guarantee that bitcoins not going to crash, but to be honest there is not guarantee the United States dollar is not going to crash either, something similar already happened in the seventies when the dollar stopped being backed by gold, at some point the dollar will no longer be backed by the hope the United States can repay its debts.

Well, if you go through my post vividly you will see that I didn't say any that third world country is currently holding bitcoin as part of their foreign reserve. And I was referring to the impacts on the third world country economies not to the market value of Bitcoin. I believe there is no country on this planet earth that is not aware of Bitcoin at the moment for Bitcoin has gone above that level.

Maybe some are already experimenting with it, we can't know all the details  ;)

Not likely.

The US has almost consistently managed to keep the value of the dollar only falling slightly for a long time.  With a central authority to handle the price it tends to end up much more stable.

That can't last forever due to the giant Ponzi scheme of the global financial system, but countries will be using it until it's gone.

Yes also my thoughts but its just like never gonna happen. Bitcoin and dollar is both currency but without dollar, bitcoin will be nothing. Dollar is the the no. 1 currency and its like being use over the world. And yeah bitcoin in third world country is now being known and use, but not all their people is aware of bitcoin as a crypto currency so maybe there's no really impact from bitcoin price.

Let's call third world country = developing country first. I think the developing country will not accept bitcoin. I mean, even big country is hard to accept bitcoin as a payment. I also think bitcoin will give a positive effects into country.

Bitcoin is not in theory for it has gotten to the level that it can be stored offline. Storing bitcoin offline will make it unacceptable for criminal to have access to it, and if it's been stolen it can equally be traced as you rightly said with dollar and gold. And I believe with time some third world country will accept Bitcoin as one of their foreign reserve.

So what about other currencies?

Such as the Euro, Swiss franc, British pound, Japanese yen, Chinese yuan, they don't count according to your reasoning or what? If people are trading their bitcoins, buying and selling them for all these fiat monies, does it mean that they will stop doing that or something will prevent them from doing that if the US dollar goes down the drain one day? As to me, you should first make a small reality check before posting anything along the "Bitcoin will be nothing without the dollar" lines

I agree, it may never happen, certainly not with the sort of volatility that is common with Bitcoin. Some countries might wake up one morning and discover their reserve have been eaten up by market volatility. I guess the time for that has not arrived yet.

No, all countries either buy or sell oil and oil became attached to the dollar and that is one of the things that lead to dollar becoming a global currency! The dollar is not the issue, the subtle conditions are.

As for the low interest rate loans you suggested, they are illusions. Hardly any of the third world countries on loans ever get to be on their feet, because the loans are fetters that further impoverish their countries.

  Dangerous, yes it is unless it becomes stable.

IMO, correct.  BTC does not have to have the US$ to survive.  It might be BETTER if so, but as you point out, plenty of BTC trading is down in other currencies.

The larger problem with developing countries holding BTC as a reserve currency is corruption!  It might be very difficult for corrupt .gov bankers to keep their hands of the state's BTC.  Developing countries are often extremely corrupt.

If they are extremely corrupt (which I basically agree with), it doesn't really matter if they steal bitcoins or dollars from their country foreign currency reserves. They will steal them anyway, so going from dollars to bitcoins is meaningless to these governments, and they will likely choose to stick to the US dollar as a more reliable and universal currency. The only advantage that Bitcoin might provide them with is better anonymity. With the dollar they are risking that their stashes can be outlawed and frozen by, say, the US government

Bitcoin gives them more leeway in this regard

Most of these countries rely on the USD because of loaning and low interest rate on loans, and because of that I doubt if these countries would ever switch their reserves most especially to bitcoin. No country could ever loan in bitcoins, and bitcoin is the kost volatile currency there is, and because of that countries would be wary on holding off these things to their reserves.

If countries will go against the United States which is tantamount to dropping their foreign reserves in dollars and adopting another  currency which could either be bitcoin or any other form, then they should be ready for some serious issues because most of these countries prepares their national budget based on the expected grants to be received from the united states, they tackle the issue if polio, malaria, flu based on support from the United States among other support

Hi time people realized all that are carrots before donkeys America uses to remain ahead of other countries and it doesn't solve anything. What these developing countries actually need is not handout from wealth their foreign reserves stacked in dollars obviously generates for America. It is little wonder why Russia and China are now fighting hard to disrupt petrodollar! I sincerely think Bitcoin is a better  choice for foreign reserve only it is still very volatile.

I think this way is very difficult, United States is a superpower that keeps its foreign exchange reserves in the form of dollars, even the United States currently controls the stock market, even the uni erofa state, which already has the euro currency as a way to unite the strength of one benuapun Able to match the existence of American dollars, let alone for bitcoin that not many countries know in detail, I think it takes a long time to do this. Even today the United States has invested in industry in every country. This could make the American dollar stronger.

I don't think so, one of the components of Bitcoin which makes it popular and also risky is it's volatility. If bitcoin was more stable, which we know is not possible, I think that that would be feasible, but with the current state of Bitcoin now, it seems highly unlikely for that to happen.

The countries will still use USD, since it provides more advantages over Bitcoin and most importantly, is also stable. I would recommend 3rd world countries to invest in Bitcoin, but still keep the majority of their funds in USD, since it is more stable.

Bitcoin has not received that much media attention and I fee like with more of that, we could see this occur with 3rd world countries.

Its true but it will take a long time for such countries to hold bitcoins as foreign reserve currency.For that,bitcoin has to be used every where and it has to be legalized.Even now,itself,iran  is discussing to use bitcoin as secondary currency to bye pass US sanctions.Iran,China,Russia,North korea,Cuba might adopt bitcoin instead of dollar as their relationship with US is not that good and most of these countries are signing bilateral agreements to pay in otheir own currrencies while trading among themselves.But it would take a long time to happen all over the world.

I don't think so. All the countries hold their reserves in gold, it is the most secure and only way. It is great risk to experiment such a thing on state level despite the fact that they could improve their wealth on that way. Bitcoin price is unstable, could drop and make them great problem.

I don't see this coming into reality in the near future. Bitcoin can be a very good trading and speculative vehicle but as a reserve currency I don't think it is fit for that role. A reserve currency must be stable and not volatile otherwise without some sort of stability it can create havoc on a nation's planning process  and can even affect the whole economy.

In most cases, the choice of reserve currencies are dictated by law and regulations...in many places the use and ownership of Bitcoin can still be illegal or at least not recognized by the government. As it is their system is still working so there is no to shift gear and experience more uncertainties.

That's idiotic.  Foreign countries hold the dollar because it's
stable.  Do you really think holding an unstable currency like
bitcoin would be a good idea?   That would be economic and political
suicide.  If the USD began to fail, countries would probably go with
Yen or the euro.   Or gold.  I get that people here love bitcoin, but
start using your heads.

You could have still passed you message without having to resort to name calling. However, I still hold same believe as you on the volatility to bitcoin is facing imagine a country having its external reserves in bitcoin and also a third world country which means they will still be import dependent and in the international market, the currency is US dollars how would they even survived and which bank or country would provide them the cover to always convert their bitcoin to dollars before having to import basic things? I am sure that alone will amount ilto frustration and adding volatility to it, will mean disaster.

Yes, you have a point there. That will make the American dollar powerful (not very actually). But I still believe a country that uses bitcoin as a currency reserve, it’s likely to compete. For example, they reserve with bitcoin when it’s around $500, and then all of them withdraw around the time it’s $10,000. They’re likely to beat U.S.

Yes they will and they should holding gold reserves doesn't give any benefit to the government they can instead build a nice cold storage facility and then store their coins safely. Bitcoin can even allow the government to make good profits every year. I would love the idea of holding bitcoin rather than dollars

I'd dump any and all reserves to get rid of the debts not denominated in the local currency first.

i also think that it may not be so easy. as third world country have many financial problems as they cannot even provide jobs to their people and majority of people are jobless therefore i do not think that they may have such reasonable. amount of money to hold them i form of bitcoin.

I read about ERP on blockchain, guys says there that  they can breakthrouth will third world country hold their foreign reserve in bitcoin against Dollar?. Their site www.darfchain.com (http://www.darfchain.com/?from=btt_num), are they say truth?

Well i think 3rd world means that its economy is still unstable in itself. From what i know they have yet to stabilize there own infrastructures. Yes everything revolves around in dollars in some countries let alone having btc in there own agendum. There are still many issues to be handled to think outside there country. Some 1st world country are not even basing there reserve in dollars.

I think no. Our country is one of the third world country. Many people in my country is still not yet ware to what is the bitcoin. So I think there is no effect to the ceconomy.

That is not visible since governments have not started such spending with btc, thus, it is very risky.
Reserves in bitcoin isnt visible for now.