Why El Salvador’s Bitcoin experiment may not find its place in Asia

Even if Bitcoin is embraced by other emerging economies, trade ties with China, volatile price swings, and the not-so-distant memory of a regional financial crisis may prevent cryptocurrency from ever taking off in Asia.

More than a month has passed since El Salvador recognised Bitcoin as legal tender. While the rollout encountered a few initial setbacks, including technical glitches that briefly took the government’s digital wallet offline, its implementation is symbolic. 

Cryptocurrency enthusiasts have welcomed the country’s decision to allow its more than 6 million citizens to transact in Bitcoin for everything from paying taxes to buying coffee. The move turns the Central American nation into an economic laboratory, testing whether an intangible asset can coexist alongside a physical fiat US dollar, which was adopted in 2001.

Proponents argue that a decentralised financial infrastructure, one that runs on a digital...

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