Digital innovation has been speedily increasing these last few years. Against the backdrop of the COVID-19 pandemic, many have resorted to transacting contactlessly, which in most cases translates to a digital experience. In 2021, a blockchain-based game dubbed Axie Infinity rose to popularity in the Philippines. The crypto game enabled many to earn AXS tokens whenever they collected, traded, exchanged, or sold Axies, which consist of cute Pokémon-like pets that could be used in the peer-to-peer game to increase one’s revenue. Axie Infinity was an instant hit in the Philippines as it enabled many Filipinos to reap significant profits during the pandemic. And hence, the play-to-earn model was popularized. The Axie Infinity boom that occurred in the Philippines is evidence enough that the archipelago’s population is comfortable with digital transactions.
In fact, according to Bitcoin Magazine, the Philippines consists of the third-largest receiver of remittances worldwide. More than 10 million Filipinos live abroad and send remittances back home on a regular basis. This is where Bitcoin and other cryptocurrencies can come to play a huge part and make a big difference in terms of wealth preservation. But first, the masses need to be educated regarding the mainstream cryptocurrency’s potential.
The Philippines thrives on remittances
According to a study conducted by World Bank Organization, remittances to “low- and middle-income countries are expected to increase by 4.2 percent this year to reach $630 billion.” In the case of the Philippines, which figures among the top five countries in the world to receive the most remittance inflows, the quality of its remittances improved as many Filipino migrants benefitted from better wages and better job opportunities in the United States during Covid-19.
Bitcoin P2P trades hit record highs during COVID-19
According to data from Triple A, the Philippines’ Bitcoin peer-to-peer (P2P) trading volume also reached record highs in the Philippines in 2020. Peer-to-peer Bitcoin transactions surpassed $1 million USD that year, which coincided with the onset of the pandemic. It should therefore come as no surprise that one of the countries displaying the fastest Bitcoin adoption is the Philippines, per a 2021 report from Triple A. Many seem to be at ease with the technology behind the mainstream cryptocurrency and data indicates that Filipinos are comfortable with transacting online.
What is Bitcoin used for in the Philippines?
With over 84.67 million smartphone owners in the Philippines in 2022, Bitcoin adoption will naturally increase within the region. And what’s even more interesting is that the way Bitcoin is utilized in the Philippines may largely differ from the way Bitcoin is used elsewhere. A director of IT and security at a Filipino insurance company told Forrester, “I’ve seen consumers use Bitcoin to pay for general goods and/or services. I’ve even seen it used to rent a motorcycle. People are curious, exploring, and now using Bitcoin. Adoption is increasing on a daily basis and in the future, I believe some people will even work and be paid in Bitcoin.”
Aside from being leveraged as an alternative to fiat payments, cryptocurrencies also provide users with more transactional freedom. Additionally, cross-border transactions can be conducted quickly and with fewer intermediaries. Often, the whole ordeal will be settled in just a matter of minutes. This coupled with the fact that no centralized political body can manipulate Bitcoin’s value through inflation makes it an attractive asset to hold. It also makes it a resilient investment, according to Nichel Gaba, the founder and CEO of Philippine Digital Asset Exchange (PDAX).
In countries where remittances account for a huge chunk of the gross domestic product (GDP), having a seamless transactional experience is of the utmost importance. Additionally, with a medium of exchange like Bitcoin, hefty third-party transaction fees owed to intermediaries like Western Union can be avoided.
The world should be paying attention to the Philippines
It may be that a country thrives on remittances but its population is not technologically literate enough to welcome Bitcoin. It may also be that the living conditions are so low that the population does not have access to basic electricity – as is the case for a huge chunk of the population in Central African Republic.
This is not the case for the Philippines, however. The Philippines, with its frequent remittance culture and its tech-savvy population, seems poised to be among those leading global Bitcoin adoption. With its affinity for blockchain games and vibrant digital experiences, the Philippines may well be the golden example of how Bitcoin can improve one’s daily life and integrate seamlessly into it.