Cryptocurrencies are gaining popularity across the world, but not all as much as Bitcoin in Cuba. Because of limitations on remittances from the United States, the Cuban government has stated its desire to regulate Bitcoin and cryptocurrencies, which is another step toward worldwide acceptance.
Beach, Cigar, Rum, and Bitcoin in Cuba
More and more Latin American countries are realizing the benefits of using Bitcoin and cryptocurrencies to avoid US sanctions. According to the Aljazeera channel, Cuba may soon recognize and regulate cryptocurrencies for payments on the island, inspired by El Salvador’s lofty aspirations to make Bitcoin the national currency.
According to the decision, which was published in the Official Gazette on Thursday, Cuba’s central bank will establish guidelines for cryptocurrencies and determine how special permissions will be issued to crypto-service providers in the communist country.
The resolution also mentions that the central bank may authorize the usage of cryptocurrencies “for reasons of socioeconomic interest” that are overseen by the government. It also expressly states that the transactions cannot be associated with criminal activity.
As Erich Garcia, a local Bitcoin specialist, explains, some Cubans already use cryptocurrency for online transactions, such as making purchases with gift cards.
Bitcoin in Cuba and El Salvador
Due to tougher limitations imposed by former US President Donald Trump, Cuba has fully ceased taking cash bank deposits in US dollars. The decision was described as “temporary,” but the history of hostilities between the two countries shows that nothing will bring the two countries closer politically or economically.
The statement coincided with the rising popularity of Bitcoin in Cuba among some people yearning for independence. Indeed, sending and receiving US money on the island has gotten more difficult, owing in part to tighter embargo regulations implemented by former US President Donald Trump.
While some anticipated President Joe Biden to strive to improve ties in the same way that previous President Barack Obama did, he instead took a harsher stance, slapping fresh sanctions on Cuban leaders in response to demonstrations in the nation.
Cuba’s intention to regulate the usage of cryptocurrencies in the country follows El Salvador’s decision to recognize Bitcoin as legal tender. It is a feasible approach, among other things, to stimulate remittances from its residents residing abroad.
Using Bitcoin in Cuba to avoid Sanctions
Iran is an example of a country that uses Bitcoin to escape sanctions. Iran has developed its own Bitcoin mining sector, which now accounts for around 4.5 percent of total Bitcoin mining. The Bitcoin produced as a result of this procedure keeps the country’s economy operating. Cuba and Iran are two of the world’s most highly sanctioned countries, according to the US.
Other nations with similar restrictions and embargoes may start to notice cryptocurrencies as a method to get around them, reducing the US’ capacity to influence other economies, for better or worse.
By using cryptocurrency, countries such as Cuba would be able to resolve these issues. By September 7th, El Salvador will make Bitcoin legal tender, and it also intends to encourage remittances through crypto. El Salvador is going to use a digital Wallet named Chivo.
There is a possibility that other nations with similar issues regarding remittance costs and sanctions, such as Venezuela, Turkey, or perhaps North Korea, may become aware of initiatives like Bitcoin mining in Iran, and this may become a larger trend.