National Bitcoin Adoption Started in 2022 CryptoBlog

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This is an opinion piece by Samson Mow, CEO of JAN3 and former CSO of Blockstream.

About a year ago I had the opportunity to speak at Feel The Bit in El Salvador alongside President Bukele. During the event, we announced the Bitcoin Volcano Bonds, while President Bukele made an important announcement: the creation of Bitcoin City. By legally recognizing bitcoin as tender and establishing Bitcoin City, President Bukele has taken a bold step towards nationwide adoption. The move helped accelerate the timeline for bitcoin to become a nationally recognized currency.

Following the announcements, I received many requests from Bitcoiners around the world asking for my help in implementing Bitcoin projects in their local communities or with their governments. This interest has come from both individuals actively involved in the Bitcoin community as well as investors. The excitement was largely inspired by the developments taking place in El Salvador and the impact they are having on the global Bitcoin landscape.

Driving the adoption of bitcoin by nation states

I had considered the idea of ​​promoting the adoption of Bitcoin by nation states for some time. After careful consideration, I have decided to leave Blockstream in 2022, start my own company called JAN3, and dedicate myself to advancing the adoption of Bitcoin as a global currency, known as hyperbitcoinization, and its adoption by nation states. Now, many might ask, why help nation states, why accelerate hyperbitcoinization?

The traditional fiat currency system has greatly exacerbated the credit cycle, a wave-like pattern characterized by booms and busts. Under a gold standard, credit is issued against assets such as gold deposits or real estate. In contrast, under a fiduciary standard, credit is issued by governments and is backed by debts, such as government bonds. In times of economic expansion, more loans are granted and businesses expand. However, at some point, there may be too much credit in circulation relative to the real output or productivity of the economy, causing a mismatch between the financial economy and the real economy and resulting in the formation of bubbles or market corrections. These events occurred more frequently and with more extreme highs and lows.

Mechanisms that central bankers have traditionally used are becoming less effective, like a diabetic who needs more and more insulin. If this trend continues, we can expect a severe economic depression in the future. Without clear price discovery, a vibrant economy, and technological and market forces to alleviate competitive pressure, nation states can escalate into conflict and war. When the cake doesn’t get bigger, it’s easier to take it from someone else.

Under a bitcoin standard, nation states have more incentive to make better use of their resources, because there is a real cost. This encourages peaceful and diplomatic resolution as the default balance of game theory. Adopting a bitcoin standard and accelerating hyperbitcoinization may be our best hope for averting the collapse of civilization and securing a free and prosperous future for humanity. Simply put, it can help prevent conflicts and wars caused by economic competition.

I announced the formation of JAN3 at Bitcoin 2022 in Miami. JAN3 is of course named after January 3, 2009, which is the day Bitcoin came into existence, also known as Genesis Day.

As our COO, a former Royal Marine named Doogie, told me, establishing a presence in El Salvador was important to gaining a foothold in Bitcoin and allowing it to take root. We made the decision to open an office there for this reason.

For the Bitcoin network to become more robust, it is essential that more countries adopt a Bitcoin standard. Although Bitcoin doesn’t need anyone’s help, it can be accelerated and sustained by getting more countries, territories, and cities to adopt it. For example, if a country mines Bitcoin, it does not attack the network. If a country has made bitcoin legal tender, it is unlikely to attempt to ban “unhosted wallets”. Overall, more countries adopting a bitcoin standard is positive for the network.

Hash to 2022

2022 has been an interesting year for many reasons.

Madeira, the President of Portugal, Miguel Albuquerque, announced the creation of FREE Madeira, which gives Bitcoin a foothold in the European Union. The autonomous nature of the Madeira region gives it the opportunity to make bitcoin a de facto legal tender.

Próspera, Honduras has become one of the most active Bitcoin hubs in the world. President Joel Bombar announced that bitcoin was legal tender in Próspera during Bitcoin 2022. Recently, a bitcoin space was inaugurated there and a legal framework was put in place to allow the issuance of bitcoin bonds.

On April 27, the government of the Central African Republic announced that it would adopt bitcoin as legal tender. This news was welcomed by Bitcoin enthusiasts, but the government also announced a project called Sango, which is based on an alternative cryptocurrency. It is clear that Bitcoin adoption in the country has not progressed as quickly as some had hoped, but we remain hopeful that the Central African Republic will continue to adopt and support the use of Bitcoin.

The crypto market has seen a bear market due to various factors, including the collapse of the FTX exchange, the Luna/Terra crash, and the collapse of companies like Celsius and Three Arrows Capital.

At the Panama Blockchain Conference in July, Towerbank, a leading Panamanian bank, announced plans to offer crypto banking services throughout Latin America and beyond and enlisted our help in setting up work of the Liquid network. Liquid, a Bitcoin sidechain, allows the capabilities of Bitcoin to be extended through the use of smart contracts, without introducing a native token. This relationship with Towerbank is a promising development in the world of crypto banking and could help make Bitcoin a powerful and versatile financial tool.

On October 28, at the Plan B Forum in Lugano, Senator Zury Ríos from Guatemala presented a video for the Bitcoin community in which she expressed her interest in potentially incorporating Bitcoin into their future policy plans. She opened a dialogue with the community and invited them to share their thoughts and ideas on the subject. El Salvador also announced that it was opening an office in Lugano, with the intention of exchanging knowledge and reaping commercial benefits. Thanks to the incredible efforts of Bitfinex and Tether CTO Paolo Ardoino, Lugano is making great strides in integrating merchants with Bitcoin. They have already succeeded in getting cryptocurrency adopted by thousands of merchants, and they continue to bring more.

At the Adopting Bitcoin El Salvador conference in November, it was clear that the situation for gangs in El Salvador had improved dramatically. Public safety has increased dramatically, with a notable decrease in homicides and other crimes. This improvement testifies to the effective measures put in place to address the problem and bring peace and security to the Salvadoran people.

El Salvador’s economy minister announced a new digital securities bill, paving the way for the country to issue bonds backed by bitcoins. The legislation will establish the National Digital Assets Commission, which will be responsible for regulating digital asset issuers, service providers and other participants involved in the digital securities public offering process.

There’s still a lot to say, but unfortunately I can’t talk about it right now. Change is coming and Bitcoin is going to be a major topic across the world.

Visions for 2023

2023 is shaping up to be a promising year for Bitcoin. In El Salvador, digital securities laws that will form the basis of Bitcoin Volcano Bonds have been sent to Congress for approval. These bonds may be available on Bitfinex Securities very soon.

El Salvador’s star will really continue to rise. El Salvador has already garnered a lot of interest in its adoption of Bitcoin, and many other countries are watching closely to see how things progress there. As El Salvador continues to lead the way in Bitcoin adoption, we expect it to continue to grow in importance.

We expect greater Bitcoin adoption in the coming year as it continues to gain momentum despite the current lows. The world needs bitcoin, at all costs. For those living in wealthy countries Bitcoin is optional, but for people living in the Global South it is a necessity. Take note, the gap between “wealthy county” and “global south” is rapidly closing.

At JAN3, we have received many requests for help from people in different countries with bitcoin adoption. In addition to our work in El Salvador and the Madeira region, we also focus on countries like Costa Rica, Ecuador and many more. Just last week, Sitiveni Rabuka, the prime minister of Fiji, said he was considering making bitcoin legal tender.

Despite the current bear market, we believe there is no better time to build a solid foundation for the future of Bitcoin adoption. The work we are doing now will lay the foundation for a freer and more prosperous economic future through accelerated hyperbitcoinization and adoption by nation states.

This is a guest post from Samson Mow. The opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.

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