Syria is contemplating the legalization of Bitcoin and the digitization of the Syrian pound as part of a strategic initiative to rejuvenate its struggling economy and attract foreign investments.
Proposed by the Syrian Center for Economic Research (SCER), this plan aims to combat economic instability, rampant inflation, and financial exclusion through the adoption of blockchain technology and cryptocurrencies.
The country has faced a severe economic downturn, with a reported 60% contraction since 2010 due to years of conflict and mismanagement, leading to a significant devaluation of the Syrian pound and diminished public trust in traditional banking.
The SCER’s proposal includes legalizing Bitcoin for various financial activities and digitizing the Syrian pound, potentially backed by assets such as gold and Bitcoin. This initiative could also leverage Syria’s untapped energy resources for sustainable Bitcoin mining.
While crypto have been used in Syria, often controversially, the SCER emphasizes the need for strict regulatory oversight to ensure transparency and accountability.
If successful, Bitcoin legalization could simplify remittances for millions of Syrians and attract international investors, similar to El Salvador’s approach. However, the plan faces challenges, including the need for effective regulations to prevent misuse and significant investments in infrastructure and cybersecurity.
The geopolitical landscape adds complexity, with neighboring countries potentially influencing Syria’s economic recovery. Ultimately, while the SCER’s proposal presents a bold opportunity for economic revitalization, its success hinges on careful implementation and regulatory enforcement.
