Bitcoin Forum

Like El Salvador, "Honduras Prospera" an SEZ of Honduras has now legalized bitcoin.
I was thinking what could be the possible benifits of bitcoin to the economy of El salvador and Hondurus.
One good article I found is here https://www.borgenmagazine.com/bitcoin-in-el-salvador/
It argues that bitcoin can reduce poverty.
What could be the other possible benifits of legalizing bitcoin

I don't see how bitcoin could do that, at least not directly.
The only indirect effect I could see, and that's just a possibility, is if bitcoin could help the economy of these countries, attract foreign investors, etc. and the improvement of economy could help reduce the poverty.
Otherwise if you think poor people are going to invest in bitcoin and become rich, that's not going to happen.

It's starting a good movement in my opinion. We all know that bitcoin is decentralized and censorship resistant so it doesn't need anyone's approval (eg. legalization) to work but also we can't deny the fact that legalization of it (specially as legal tender not an asset or silly things like that) tremendously help bitcoin adoption.

P.S. Google tells me SEZ is a special economic zone in Honduras so it doesn't look like this is a country wide legalization. Which makes it a smaller version of El Salvador case.

Interesting, I did not know that it was an economic zone with a special status:

Honduran special economic zone adopts Bitcoin as legal tender (https://economictimes.indiatimes.com/markets/cryptocurrency/honduran-special-economic-zone-adopts-bitcoin-as-legal-tender/articleshow/90718166.cms?from=mdr)


When I read this I thought about the issue of remittances, often cited by Bukele, he says that they save a lot compared to the shipments that were made through Moneygram, etc., but the article linked by the OP cites other factors.

1) Bitcoin prevents inflation, which has historically been very high in South American countries, many of them ending up de facto dollarized or on the black market.

2) It prevents discrimination towards de unbanked and the poor.

3) It prevents corruption, because Bitcoin transactions cannot be censored, but this is only true if users use non-custodial wallets.

No any kind of currency or technology can uplift poverty. So I don't think it's possible.

In regards of investments, yes, any kind of investments even not bitcoin will probably result gains and uplift any financial problem. But it's that easy as said many losses than winning. It needs lots of determination, knowledge, etc.

I don't know how this will reduce poverty. Poverty in a country happens out of improper governance and the imbalance in the economy. To overcome this the government needs to take more productive initiative to provide job as well as the basic needs of people. Just on legalizing bitcoin or through adoption of bitcoin in special economic zone of a country isn't gonna make an impact over country's economy as well as in reducing poverty.

Benefits? Bitcoin will more demands and government from any other parts of the world will find its relevance so for continuous growing up the number of users can rise up the influence of bitcoin to grow more. Also if their citizens will dig more knowledge about it they might escape from poverty and lift up their economical status and take advantage with it.

One of the most obvious benefits with recognizing Bitcoin or making it a legal tender just like El Salvador is that a country or a special economic zone can be on the news for free just like what we have here in this forum...because I have never heard of this Honduras SEZ before. Now, another possible benefits is tourism and I think El Salvador is experiencing it right now. As to reducing poverty, it can be related to possible businesses that can come to the country that are crypto-related...again the example of this can be El Salvador though this is still a developing story.

I guess it's an exaggeration to say that bitcoin will reduce poverty, it's not a magic bean that will solve every human problems we have.

I guess it will be more beneficial if countries are willing to trade with them in their SEZ with bitcoin as well and not fiat. Obviously they are going to accept it, but is the other side willing to used bitcoin to transact with them?

It is very nice to see that bitcoin is getting more and more popular and that lots of countries are considering to legalize it. With these two actually taking this steps, I expect more countries that are still watching and contemplating on such decisions to actually legalize bitcoin as well when things turn out for the good for the first countries that actually took the first step. Bitcoin and the whole industry that it is in truly opens lots of doors to most types of people. It gives a ray of hope for the less fortunate but capable individuals specially the NFT space. I really can't wait to see what happens when bitcoin and the rest of this industry gets legalized at least in many parts of the world if not entirely.

Never heard of Honduras Prospera before but from what you say that there is SEZ(Special economic zone), I can understand the zone called SEZ is a place where there are different business and economic rules than the other places in the rest of the country, so even if they legalize bitcoin and cryptocurrencies there won't have much effect on the rest of the country, however, rules of SEZ is different in countries and some countries will give the zones and frame so they won't be able to deal anything out of this frame if there is no such thing for Honduras this can be a great step forward for them.

If you look at the geographical location, this legalization is not without reason. Honduras is a more strategic beach destination that is also close to the bitcoin-friendly country El salvador which resulted in a 30% surge in tourist numbers according to media reports (https://finance.yahoo.com/news/el-salvador-says-tourism-30-200847481.html). Given that it only applies to parts of Honduras' tourism area, their new policy cannot be interpreted as the goal of building the country's economy. Especially, if the tourism facilities are dominated by only the rich.

Since El Salvador was one of the first countries to adopt Bitcoin, it does not seem strange to me that its sister country Honduras now wants to be part of this idea. The funny thing is that a little less than a month ago they commented that they denied the use of BTC as legal tender. , however there was interest. What I do see that Bitcoin can bring to the country as a benefit is to combat the inflation that the country presents, helping to improve the economy of the place to a great extent.

I doubt it will remove poverty from the country. If it was possible, all poor or 3rd world countries would make bitcoin legal to remove poverty from their country. It could improve the overall economy a little, but not much. The poor won't be able to invest in bitcoin and hold to make profit from it.
The benefits would be flexible and easy money transaction. Others working as an expat can send money to their country at almost free of cost and without any third party being involved. And the main advantage would be the people being the owner of their own money.

Bitcoin can't solve complex socio-economic issues, such as poverty, but I can understand why countries with very weak economies might be interested in Bitcoin. Adoption of crypto-friendly policies can bring businesses and investors, which would in turn bring jobs, and job would bring money, which will then be spent and thus the wheel of economy can spin. It's not a remedy, but as one action among others, it can hypothetically somewhat improve the situation. This adoption is different from El Salvador, though, because it's just in a Special economic zone, which already has its own rules, and El Salvador is pretty much the only example of the whole country adopting Bitcoin.