Called “the end of the world survey” by political analysts, XP/Ipespe showed an appalling scenario for Brazil and possibly incredible for the price of bitcoin.
The vote intention poll published yesterday by XP shows that Luiz Inácio Lula da Silva (PT) is growing in the first and second round simulations.
In all scenarios Inácio Lula leads with ample advantage, while Ciro Gomes gets stronger and Bolsonaro completely melts.
Bitcoin price could skyrocket in 2022
Although the Bitcoin network is completely independent of politicians, the price of the cryptoactive in real pair (BRL) can be affected by the economic and financial situation in the country.
During the Bolsonaro government, bitcoiners saw their equity grow 18 times against the Brazilian currency. In the United States, the BTC/USD valuation was ‘only’ 14 times. This means that an investment of R$10,000 in BTC on the first day of the current government would have turned into R$~180,000.00.
At the same time, Brazil’s monetary base grew ~3.5 times that of the US.
The reality is that the Bolsonaro government printed more money than Lula, according to data from the Central Bank of Brazil (BCB).
However, the growth of the current monetary base would be a “little chip” for the expansionist plans of the current leader of the polls, who defended the creation of 300,000,000,000,000 new currency “just to spend on the coronavirus”, check out the video:
Lula’s proposal could practically double the restricted monetary base, increasing Brazil’s indebtedness and decreasing the value of each real in circulation. With the real worth less, the price of assets (such as Bitcoin) would likely skyrocket.
This could be terrible for Brazil in general and incredible for the face value of bitcoin in BRL.
But even for bitcoiners, the situation could get worse with higher monetary inflation. In countries like Argentina and Venezuela, which are facing inflationary processes, crime has increased, there is a lack of food and basic items.
Bitcoin is the best hedge against politicians
As we can see in the chart above, the monetary base continues to expand regardless of governments and political ideologies, as well as the Brazilian debt, which already exceeds R$30,000 per person.
Since its creation, the real has already lost 85% of its value. This means that R$1 today is equivalent to R$0.15 in 1994. Governments of the center, right and left have gone through power and even so their money is worth less every day.
That’s why betting on bitcoin is the smartest way to protect yourself against corrupt politicians, savings confiscators and ineffective governments.
The cryptocurrency works without the need for a central body, has a total of 21 million units maximum and can be easily transported if you need to leave the country.