Dollarisation vs Bitcoinisation

Countries with weak or volatile currencies often face economic uncertainty and high inflation, which can severely impact the daily lives of their citizens. These issues make it difficult for individuals and businesses to save, invest or plan for the future, as their local currency may rapidly lose value. For governments, inflation can limit their ability to borrow affordably, leaving them vulnerable to economic downturns and external financial shocks. In this context, people naturally seek alternatives that preserve value and allow for smoother trade and economic planning; historically, dollarisation has served as a solution for countries with these challenges. By adopting the US dollar, they can benefit from the stability and global acceptance of the currency, which reduces inflation and provides a level of economic security. Yet, dollarisation also comes with significant trade-offs - countries that adopt the dollar effectively relinquish monetary policy control to the US Federal Res…