Liberland is one of the most appealing initiatives the cryptocurrency world has ever seen. Up until this point, the country would accept fiat currency payments and cryptocurrency transfers alike. As it turns out, dealing with fiat currency and banks remains a key problem for innovative projects. As of yesterday, the country only dealing with cryptocurrency, primarily in Bitcoin. But that does not mean other currencies will not make an impact in the future.
The Liberland Story Keeps Getting Longer
When Liberland was founded initially, many people were concerned over the viability of this project. Claiming a piece of land between Croatia and Serbia that no one “owned” seemed like a risky venture. For some residents, it has proven to be quite a hustle ever since, with several people getting arrested in the process.
But the Liberland President, Vit Jedlicka, has no plans on giving up on his dreams of creating a nation where cryptocurrency will play a critical role. In fact, after some discussion among the “government” of Liberland, the decision was made to go all-in on cryptocurrency. No fiat currencies will be accepted, which should solve some of the lingering accounting issues.
Bitcoin will become Liberland’s national currency moving forward, a change that was planned for quite some time now. Moreover, all ministers and members of parliament will receive Bitcoin-backed debit cards for expenses and purchases. An interesting decision, and one that may have widespread ramifications for Bitcoin as a whole.
One possible concern is how the volatility of Bitcoin could make it difficult for Liberland retailers and citizens. Hedging against volatility in Bitcoin is very difficult. At the same time, using Bitcoin allows for greater transparency compared to relying on a traditional financial ecosystem. It looks like the Liberland president and his staffers carefully thought about this decision before announcing it to the public.
Some Facebook users are proposing Liberland should diversify its portfolio of accepted cryptocurrencies. Switching from fiat and Bitcoin to Bitcoin-only is a big step, and it will take some time to see how it will play out. Once everything is sorted, however, there may be time to look at introducing additional cryptocurrencies. Then again, all of these currencies can be converted to BTC, so there may not be a real “need” to work with altcoins, for now.
It is important to keep in mind Liberland has its own native token already. Merits, which are not an official currency in the traditional sense, can be used to pay local taxes. Issuing their own national cryptocurrency does not make sense, as it would end up being counter-productive e to what the Liberland team is trying to achieve.
Header image courtesy of Liberland