Ecuador is launching its first digital currency, backed by the country’s central bank, supposedly as a way to help poorer people who haven’t previously been able to access traditional banking. The nameless crypto-currency will come into use in December and could mean that the country might drop the US dollar – the currency Ecuador introduced after its banking crisis of 2000.
While President Rafael Correa has shot down claims that the crypto-currency will replace the dollar, some analysts suggest the most likely effect the new currency will have is to devalue its dollar holdings and potentially hit the poor the hardest.
President Correa, who referred to himself as “one of the best presidents in our history” in a televised interview this month, is known for his strong arm approach and recently pushed through a new law that makes publishing, broadcasting or spreading news that creates “economic panic” a crime punishable by a prison sentence of seven years. His conscience over media freedom appears a little elastic, however, having granted Wikileaks founder Julian Assange refuge in his London embassy for the last two years.
City A.M. Reporter