A member of the Tongan parliament Lord Fusitu’a, wants Tonga to adopt Bitcoin as a legal tender like El Salvador to cut down remittances cost, boost GDP and improve the lives of the country’s citizens.
According to Financial Review, Fusitu’a said that the country has lost more than 30% of its GDP on paying Western Union fees. Many Tongans in the diaspora use Western Union to send money to their families at home, but almost half of it goes to remittances.
“Tonga is the highest remittance-dependent country on earth…Between 38 per cent and 41.1 per cent of our GDP, depending on which World Bank figures you use, is remittances. So, nearly half our economy is money sent back from our diaspora,” he said.
He believes that the solution to this is for the country to adopt Bitcoin as legal tender and use digital wallet Strike on the Bitcoin Lightning Network to send and receive the digital currency at zero fees.
In the last 24 hours, bitcoin is down by 0.79%, with a current price of $47,603.84 as at the time of writing this. Within 24 hours, bitcoin dropped to $47,289.47 low and $49,214.85 high. The trading volume of bitcoin in the last 24 hours is $1.91B. The current market capitalization of bitcoin is $796.26B. Currently, $18.82M bitcoins is in circulation.
Stats and Image from Coin Desk
According to Fusitu’a, the use of Strike to receive foreign exchange from Tongans in the diaspora will cut down the cost of remittances and allow Tongans to save in Bitcoin and accumulate interest.
“So instead of sending $US100 and receiving $US70, you send $US100 and get a $US100 – an extra 30 per cent of disposable income. That’s like going to someone in the US and saying you’re not going to pay any more federal income tax,” he added.
However, the Governor of the Reserve Bank of Tonga, Sione Ngongo Kioa said, “the adoption of bitcoin as an official alternative currency is definitely unlikely,” he added.