Brian Armstrong, CEO of Coinbase, has spoken out on the need for the leaders of Brazil and Argentina to consider adopting Bitcoin, following the announcement that the two presidents are working to create a common currency.
The Coinbase CEO explained in his tweet that Bitcoin it is a digital currency worth considering, adding that it is a promising long-term candidate for both countries.
Bitcoin’s limited supply and its rapid adoption by many investors and institutions are some of the factors that highlight its global value.
Bitcoin has also been the most valued cryptocurrency by market capitalization for the last 5 years. Demand for the benchmark cryptocurrency has grown tremendously in that time and has resulted in its value surpassing all other cryptocurrencies in existence.
Bitcoin has also been labeled by many prominent financial figures, including Paul Tudor and Tim Draper, as the only cryptocurrency with intrinsic value.
In contrast, however, investment strategist and economist Raoul Paul has opposed Brian Armstrong’s suggestions, explaining that Bitcoin’s intense volatility would do more harm than good.
Currently, no one can have a national currency with 100% volatility that declines 65% on the bottom of the business cycle and rises 10 times on the up cycle. Companies struggle to plan for or cover that, he said in a tweet from reply.
The presidents of Argentina and Brazil will use a common currency to boost the economy of South America
Argentina and Brazil have opened up about their joint economic goals. Both countries are now embarking on a mission to boost the use of their local currencies. Existing monetary policies will also be tightened in an attempt to circumvent exchange rate barriers.
The President of the Argentine Republic, Alberto Fernández, and the President of Brazil, Luiz Inacio Lula da Silva, announced these plans in a jointly written article published in the Argentine website Profile.
They also spoke about the need for a common currency that has the capacity to strengthen economic growth throughout South America. The article added.
We also decided to advance the discussions on a common South American currency that can be used for both financial and commercial flows, reducing costs, operations and our external vulnerability.
Before the decisions of both presidents, Fernando Haddad and Gabriel Galipolo, Brazil’s current finance minister and his executive secretary, had first advocated the need for a common currency in 2022.
Plans are now underway for the two leaders to discuss at an upcoming summit to be held in Buenos Aires. The creation of another new currency, “sur”, will also be discussed as a tool to promote trade within the South American regions and also to help reduce Brazil’s dependence on the US dollar.