When financial instability increases, interest in owning cryptocurrencies goes up

Crypto can be a good escape mechanism for those who do not trust their local currency or banks

Chicago Mayor Rahm Emanuel has said he believes cryptocurrency adoption is inevitable. Emanuel has based his outlook on Bitcoin’s and other cryptocurrencies growing appeal in an increasingly unstable world.

The former chief of staff in president Barrack Obama’s government expressed his sentiments when he took the stage during a local Fintech gathering to give a positive statement to blockchain and cryptocurrencies as reported by Forbes on March 20th. Emanuel was responding to a question from the audience when he said crypto adoption was inevitable but went on to say it wasn’t easy to predict when such a major monetary shift could occur.

Cryptocurrencies during financial crisis

While admitting he wasn’t an expert on the matter, the mayor said that nations facing financial embargos such as Iran and Venezuela could harness cryptocurrencies as a useful escape mechanism. He stated:

“Nation states are falling apart or receding. City states are emerging, so the political structures we all grew up under are changing. One day, somebody’s going to figure out – whether that’s Argentina, ten years from now, five years from now – how to use cryptocurrencies to stay alive when they’re facing a financial crisis, and then you’re going to find out that this moment has arrived.”

Digital assets as a store of value

The Forbes report says that the mayor of Chicago is convinced that an alternative currency as a way of dealing with debt markets is bound to happen sometime in the future. People living in nations such as Zimbabwe, Venezuela, and Turkey where the authorities have mismanaged finance to the extent that inflation has spiralled out of control may want to choose digital assets as a store of value since they are not correlated to any entity or government. Saying the trend now shows cryptocurrencies and blockchain adoption is inevitable, Emanuel said:

“I don’t know if that’s ten years, and I don’t know if that’s 20 years, but it’s affirmative. I don’t know what it is. I know it’s an alternative way to trade, and therefore, I gotta learn about it.”

Emanuel’s narrative goes against the grain where incumbents almost always have nothing positive to say about cryptocurrencies and when they do it will always have a negative tone such as the use of digital assets for criminal activities. His narrative follows in the coattails of Colorado’s Governor Jared Polis decision to sign a law that exempts cryptocurrencies from securities laws.

The law “Provides limited exemptions from the securities registration and securities broker-dealer and salesperson licensing requirements for persons dealing in digital tokens;” and is expected to make the application of blockchain technology and growth of related companies in the space much easier, as digital assets are not subject to securities laws that would otherwise encumber them with stricter regulation.