Lebanon’s economic crisis has gone from bad to worse as the local currency lost a further 50% in ten days. The crisis has revitalized interest in cryptocurrency among the younger generation.
Local cryptocurrency advocate and author of The Bitcoin Standard Saifedean Ammous made the assertion on twitter. Ammous said the Lebanese Lira had shed off over 50% of its value in the last ten days. He said at $0.000093, the local pound was now worth one satoshi, which is a historic low for the currency. Ammous said on June 21; “Ten years ago, one Lebanese lira was worth 0.67 Bitcoin.” He tweeted a day earlier:
“Imagine spending 45 minutes explaining Bitcoin to a group of Lebanese people and then having one of them ask: ‘but without a central bank regulating, what guarantees Bitcoin’s value?”
Prices and Inflation Skyrocketing
Lebanon is undergoing an unmatched economic crisis with the local currency reportedly losing over 86% of its value. The central bank’s policies have come under fire lately as citizen’s protest the government’s handling of the economic meltdown, which has led people to live in a situation deteriorating “terrifyingly.”
Protests erupted in Lebanon last month over the government’s handling of the unfolding crisis. The meltdown ranked the local currency, devastated people’s savings sending prices and inflation skyrocketing. The growing crisis has turned daily life in Lebanon upside down. The country is now preparing for a wave of migrations as soon as the closed international airport opens.
Talking to Al Jazeera, 32-year-old graphic designer Bernard Hage said:
“We’re like prisoners who do nothing but try to plot our escape.”
Cheap and Accessible Alternative
Trust in Lebanese banks is at its all-time low over increased restrictions on Forex movements. More Lebanese are now turning to cryptocurrencies like bitcoin. They believe it’s the best way to shift their money in and out of the country. Lebanon’s youth told an informal Twitter survey last May that over 57% of locals preferred to be paid in Bitcoin. Mahmoud Dgheim told Al Jazeera last February:
“Right now, Lebanese are interested in escaping tight restrictions on cash withdrawals and transfers. They basically want financial freedom […] if you want to go around the banking system, Bitcoin is a solution.”
The Lebanese economic crisis has been raging for years. However, the ongoing political turmoil and the global market downturn caused by the Covid-19 pandemic have made matters worse. The devaluation of the Lebanese pound has made Lebanese seek bitcoin as an alternative to the country’s fractured banking system.