Could Trump’s New Remittance Tax Push Crypto Adoption?

One of the things that may have contributed to the return of Bitcoin and other cryptocurrencies is the current political climate. You have Brexit that may have continuously pushed the price of cryptocurrencies up. In addition to this, there are those countries suffering from financial crisis driving the adoption of cryptocurrencies.

US President Donald Trump proposes a remittance tax in the US that would provide additional fees on money that is being sent outside the US. This recent effort is a move by President Trump to dissuade immigrants from working in the US. However, this move could potentially be good for crypto.

It could potentially bring cryptocurrencies as an alternative when it comes to moving money abroad. There are cryptocurrencies such as XRP that offer a better alternative to the usual means of sending money across borders.

XRP and Cross-Border Transactions

Ripple has been pushing the use of XRP for cross border transactions. Ripple has partnered with banks. In addition to this, Ripple also partnered with the likes of Western Union. And recently, Ripple has also been working on targeting countries in South East Asia such as the Philippines. The Philippines has been known for receiving remittances from its overseas workers.

There are a number of peer-to-peer platforms that can also benefit from this move by Donald Trump. You have the likes of LocalBitcoins, Paxful, and Bisq as some of the more popular exchanges that can be used.

Mexico and Venezuela’s Growing Trading Volume

According to a study made by Coin Dance, Mexico and Venezuela have an increasing number of people using cryptocurrencies. Mexican users have sent $500,000 worth of cryptocurrencies in just seven days. As for Venezuela, the country has become reliant on cryptocurrencies since it has been suffering from economic problems.

Businesses are already accepting Dash considering hyperinflation. Also, you have the fact that even the Venezuelan government has been looking into blockchain as a solution for its economic woes.

Threat to Immigrants

According to former Kansas Secretary of State Kris Kobach, “The threat (to illegal immigrants) I propose is one that actually helps (the US) if we follow through on it. That is the threat of ending remittances from the majority of people in the United States from Mexico who are here illegally. That is a threat that we could carry through on that actually helps our economy because the money is not sent home, it stays in circulation in the US economy and helps rev up our economy. It’s actually a good thing if we follow through”.

According to White House spokesman Hogan Gidley, this is a “top priority” for the Trump administration. This could potentially de-incentivize immigration in the US.

But the question is if it can really stop people from sending money out? Given the presence of cryptocurrencies, it is possible that people are going to make use of this as an alternative to the usual money transfer method. However, it is undeniable that it can have an impact to the number of people who are working in the US and sending funds to their families back home.