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Cryptocurrencies may soon rule the United States – Mexico remittance market. As President Donald Trump reiterates his vision to build a wall between the two countries, United States may look for ways to recover a portion of expenses from Mexico either through increased taxes or remittance blockades.
Mexico may not willingly bear its fair share of costs as it is not comfortable with the wall separating both countries. It might lead to the United States making good on the promise made by its president-elect during the election campaign and after assuming office.
However, such a move by the United States will not only sour the relationship between both the countries but also puts the United States in a bad light. But for those who have been regularly sending money back home to Mexico from the United States, it can be disastrous. They will be left with no other option but to opt for alternatives.
Bitcoin and other cryptocurrencies are the most viable alternative methods of remittance that one can adopt in case these fund transfer restrictions become a reality.
Mexico receives a considerable sum of revenue in the form of remittance. In 2016, total remittance received by Mexico stood at around $24.6 billion which is more than the $23.2 billion revenue it generated through oil exports in 2015.
Earlier this month, Donald Trump was quoted by a news outlet saying,
“They [Mexico] will reimburse us for the cost of the wall. That will happen, whether it’s a tax or a payment — probably less likely that it’s a payment, but it will happen.”
Following Trump’s statement, the President of Mexico Enrique Pena Nieto countered saying
“We must assure the free flow of remittances, an invaluable contribution to national development and indispensable for millions of Mexican families.”
President Donald Trump’s recent executive order permitting the wall construction has heated up the atmosphere in both countries. The potential blockade on remittance combined with weakening Mexican economy can end up creating an economic emergency in the country. The use of cryptocurrencies at this crucial moment for both remittance and day-to-day use can help Mexicans successfully overcome the repercussions of US blockade and economic slowdown.
The use of cryptocurrencies for remittance is not a new thing. It remains the most efficient and economical mode of fund transfer between people in different countries. Its implementation during troubled times will not come as a surprise to many. If things were to go south for the country, demand for Bitcoin would soon grow in the Mexican market, which may further push the price of Bitcoin. Under the circumstances, the coming days seem bright for Bitcoin.
Ref: CNN Money | Image: NewsBTC