Oceania is usually known for divine blue waters and sunlit beaches – a destination where tourists can abandon the digital world and relax. Yet, countries like Tonga, Vanuatu, the Marshall Islands, and others are seeing more crypto penetration, due to both locals and foreign groups.
Most recently, Tonga’s MP Lord Fusitu’a has been working on a bill to make Bitcoin legal tender in the country with a population of 106,000.
A split world
Fusitu’a pointed out the difference in the way developed nations and developing nations used Bitcoin. He claimed that developed nations mostly saw Bitcoin as an investment asset, while those in developing countries needed the Bitcoin Lightning Network. Coming to what he called the “Pacific perspective,” he stressed on cross-border remittances at a low cost.
During an interview, Fusitu’a said,
“For remittance dependent countries and countries that suffer from hyperinflation, it’s not just the most sensible choice – it’s almost our only choice for survival…”
Much of Tonga’s population lives abroad and sending home money is vital. The U.S. Department of State website noted,
“Tonga’s economy is characterized by a large non-monetary sector and a heavy dependence on remittances from the more than half of the country’s population that lives abroad, chiefly in Australia, New Zealand, and the United States, particularly in Utah, California, and Hawaii.”
Zooming out
More countries in Oceania are experimenting with crypto. This means both providing digital tools to locals and exploring blockchain’s uses cases on a larger scale.
For example, people in Vanuatu attended training sessions to learn about a digital cash pilot project. Meanwhile, Tuvalu’s government has been developing a blockchain-based ledger to protect its systems from climate change.
However, Oceania has a long history of colonization and foreign missile testing. Even today, citizens are worried that foreign crypto companies could be experimenting on their economies in a similar fashion. While El Salvador’s “Bitcoin Beach” was met with global acclaim, politicians in Oceania might be more cautious about such foreigner-led projects.
Since internet connectivity is poor and access is low, those in rural areas also face the risk of exclusion. While El Salvador’s broadband speed is an already low 16.68 Mbps, Tonga’s all time high was less than half of the same. Anti-Bitcoin protests like those in El Salvador are very possible. Yet, people in the diaspora might welcome a crypto remittance corridor.
Regulation is also diverse. While Vanuatu has prohibited crypto trading, the Marshall Islands has a legal but inactive cryptocurrency – Sovereign [SOV]. It was also exploring CBDC options.
Ultimately, as Oceania’s crypto exposure increases, investors worldwide will now be watching Tonga.
