Looking for a Safe Investment in the Midst of Geopolitical Turmoil, Bitcoin Included?

Liputan6.com, Jakarta – Global political and economic turmoil continues to increase. Various geopolitical tensions continue to escalate, such as the conflict between Ukraine and Russia, followed by Hamas and Israel. In the midst of these various pressures, investors are looking for safe and strong instruments.

Indodax CEO Oscar Darmawan explained that Bitcoin could be an option. This crypto asset offers the advantage of being an asset that is more resistant to pressure or political turmoil.

“Bitcoin offers the advantage of being an asset that is not linked to a country's monetary policy and has a decentralized nature that makes it more resistant to political pressure and external sanctions,” he said, quoted from Antara, Sunday (15/6/2024).

In May 2024, China's central bank experienced a significant slowdown in gold purchases, indicating a potential change in strategy amid increasing global geopolitical tensions and countries' efforts to find alternative reserve currencies.

Since the beginning of the 21st century, China is said to have consistently bought gold to secure profits from trade surpluses and as an alternative to the United States (US) dollar. The decline in gold purchases indicates a shift in the country's foreign exchange reserve policy which has the potential to have a significant impact.

Considering the shift in global geopolitics, diversification is considered important because it will protect against the negative impact of political or economic instability in one region, as well as exchange rate fluctuations and inflation. This increase in tensions is pushing some countries to look for alternatives in their reserve currencies.

“In looking for alternatives, bitcoin emerged as an attractive option,” he said.

El Salvador

Oscar also highlighted that bitcoin has proven to be an effective investment tool for investors looking for growth opportunities and protection against fluctuations in conventional currencies.

For example, El Salvador became the first country to adopt bitcoin as official foreign exchange in September 2021 under the leadership of President Nayib Bukele. The main aim of this measure is to increase financial inclusion, attract foreign investment, and reduce the cost of remittances for citizens working abroad,

“Salvador is integrating bitcoin into its national financial system to achieve long-term economic benefits,” said the CEO of Indodax.

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