Ethiopia Discovers Bitcoin – Trustnodes

Ethiopia Discovers Bitcoin

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Ethiopia bitcoin volumes, Nov 2020

Bitcoin has reached Ethiopia, the somewhat poor but aspiring much divided African country which boasts of never having been occupied.

They barely touched the new digital gold last year, but this year volumes have increased according to Paxful (pictured above).

It is tiny amounts globally speaking, but it is an indication that bitcoin has arrived in this inflation stricken country.

Inflation in Ethiopia, Nov 2020
Inflation in Ethiopia, Nov 2020

Interest rates are 7% there, so commercial banks are not printing enough for 20% inflation.

However it seems the central bank may be printing too much, something that could affect their exchange rate, making imports expensive and thus the rising prices.

Ethiopia M1 supply, Nov 2020
Ethiopia M1 supply, Nov 2020

Some of this printed money is presumably going towards the war with Tigray, a province in Ethiopia.

The conflict arose after the central government postponed elections due to covid, but Tigray held them in their region anyway.

That’s the official story. The real story is probably that Ethiopia is bidding to become a regional power. So it is putting its own house in order, a potentially difficult task due to Ethiopia having some 100 ethnicities and languages, with this country being both christian and muslim.

Yet it is well placed geographically to take some regional responsibility, which pits it against Egypt up there.

Economically however this country is weak by European standards, having a GDP of just $90 billion for its 100 million people.

However as everywhere that’s not quite distributed equally, with some in Ethiopia being fairly cultured and refined.

They have discovered bitcoin now quite a bit after Nigerians have been playing with digital gold since 2017, and quite a bit after South Africans.

Yet neither Nigeria nor South Africa appears keen to play power games, while Ethiopia seems to have ambitions which can well determine quite a bit about what goes on in that region.

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