Increased Trade Protection Measures: Threat or Opportunity for Bitcoin Development?

The global economic slowdown has caused many governments to implement trade protection measures in their countries. Will this pose a threat to the development of Bitcoin?

World trade growth slows

Globalization and the resulting increase in world trade have driven global GDP growth over the past few decades. Many countries have found their place in the global economy and have experienced tremendous growth—China in manufacturing, India in software, the Philippines in outsourcing, and so on.

However, the growth rate of the world economy seems to be stagnating. According to a recent WTO report, the forecast for trade growth in 2017 has been cut to 1.8%-3.1% (from 3.7%). There is a possibility that global trade growth will be lower than the growth of global GDP (about 2.2%).

Brexit and Trump protection measures

When faced with a thorny economic problem, politicians have a simple excuse – blame it on another country. Donald Trump’s meteoric rise as a politician shows how well he has exploited Americans’ anxieties about immigration.

Brexit has shown that despite Britain’s status as a global financial center, the British people as a whole still feel their jobs are threatened by immigration, and as trade disputes grow, this has led to protectionist measures in various countries to varying degrees.

Bitcoin has no borders

When two parties from different countries trade, the question of what currency to use becomes a problem. If both parties do not have sufficient bargaining power, then the transaction requires a neutral, circulating currency such as the US dollar.

Considering the easy cross-border transfer feature of Bitcoin, once it matures, Bitcoin will easily achieve the same status as the US dollar. As the Bitcoin community grows and people's acceptance increases, Bitcoin will acquire the characteristics of a "mature currency" - liquidity and low volatility. At this point, global trade will no longer be hindered by trade protection. The current form provides a driving force for the development of Bitcoin.