Then follow us on Google News!
The decline in value of national currencies is fueling further Bitcoin adoption. Malaysia’s Ringgit has hit an 18-year low against the US Dollar, as Bitcoin trading in the country continues to skyrocket. Malaysia joins a growing list of countries which saw their national currency decline rapidly in 2016, and it looks like 2017 will bring more of the same.
A Very Bad Year For The Ringgit
Malaysia is an emerging market plenty of investors are keeping an eye on as of late. Unfortunately, the country’s national currency is also suffering from a significant devaluation. In fact, the Ringgit has lost 17% of its value against the US Dollar since April of 2016, which does not bode well for the local economy.
Things started out quite well for the Ringgit in 2016, though, as the first four months of the year showed a bullish trend. Ever since Donald Trump became one of the two Presidential candidates, however, things started to go downhill rather quickly. His official election did not calm the markets either, and only caused future losses
Fast forward to January 4, 2017 and the Malaysian Ringgit reached an 18-year low against the US Dollar. One US Dollar is worth 4.4995 Ringgit, which goes to show the local economy is in a terrible state right now. Unfortunately, it appears this downward trend will accelerate in 2017, according to a BMI Research report. China is Malaysia’s largest export partner, which will impact the economy in a negative manner over the coming twelve months.
At the same time, the devaluation of the Ringgit is creating new alternative investment opportunities for Malaysian investors. Preserving purchasing power is the top priority right now, yet local investments do not provide opportunities to do so. Bitcoin is gaining a lot of momentum as of late, and most of the trading occurs through the LocalBitcoins marketplace.
It is safe to say Bitcoin will continue to gain momentum in Malaysia throughout all of 2017. Although this means more people flock to Bitcoin as an investment vehicle rather than an asset, it also means more users will get acquainted with the concept of cryptocurrency. It is difficult to predict what this mean for Bitcoin moving forward, but ecosystem growth is never a bad thing.
Header image courtesy of Shutterstock