Bangladesh Should Diversify with Cryptocurrencies Amid Global Shift

The global economy is undergoing a significant shift due to geopolitical uncertainty and trade fragmentation. As a result, many countries are diversifying their foreign exchange reserves away from the US dollar.

This trend of de-dollarisation has led to an increased adoption of cryptocurrencies worldwide, with nearly 10% of internet users owning crypto by 2026. Sovereign states have also started investing in crypto as a strategic reserve and means to bypass traditional banking networks or utilize surplus energy sources.

The US, El Salvador, Russia, Bhutan, Ethiopia, Pakistan, India, and Vietnam are among the countries that have adopted cryptocurrencies for various purposes, including trade and reserves. Bangladesh can benefit from this trend by adopting crypto, which could provide cost-effective remittances, overseas payment reception for freelancers, easy cashless payments, and diversified trade settlements.

However, there are challenges to be addressed, such as capital flight, volatility, criminal activities, lack of necessary infrastructure, and electricity demands. A phased approach is recommended, with a central bank digital currency and regulated digital assets being explored for international trade settlement.