In the midst of Spain’s financial crises, a record number of its citizens are turning to Bitcoin, an online virtual currency used to exchange goods and services. Downloads of Bitcoin’s mobile applications hit record highs in Spain after it was announced that the nation of Cyprus risked defaulting due to its exposure to Greek banks. “Compare their download histories to those from a country like the UK and it’s clear that the upward trend is more pronounced in the more at-risk nation. Bitcoin Gold’s all-time high ranking of 83 in Spain came on 17 March; for Bitcoin Ticker, 68 on 17 March.”
What’s the Big Idea?
The motivation behind a switch to Bitcoin currency must involve a collapse of faith in any central banking system’s ability to regulate the value of its currency. “If the fear is that the Spanish banks might implement a Cypriot-style deposit tax, then bitcoin would help. As a potentially anonymous currency, it’s a tax avoider’s—and tax evader’s—dream, but only insofar as taking money out of the bank and keeping it in cash under the bed is. You can keep your money hidden from the tax man, but when you come to spend it, you’re going to raise questions.”