Survey: the less economic freedom, the higher the Bitcoin price

A new academic study by US experts found that the lower the country's level of economic freedom, the higher the price it bitcoin.

Research was conducted by post-graduate of business school Darla Moore in South Carolina, Robert Viglion. He concluded that investors of countries with repressive economies, have a much greater incentive to invest in digital currency, than in other countries.

Bitcoin, he said, it is an inexpensive option that allows user to bypass the internal constraints of the financial system of the country.

"Countries with limited financial freedoms (with capital controls and exchange controls, such as Argentina), Bitcoin value is much higher. This can be traced throughout the history of Bitcoin: it represents the highest values in repressive countries. I think that the interest of Venezuelans to bitcoin is another confirmation of the fact. "

Viglion noted that the high cost of bitcoin in Argentina, probably due to the difference between the official exchange rate set by the Government of the peso, and an effective exchange rate cryptocurrency which is used by local traders.

In the politically unstable conditions cryptocurrency traditionally becomes a means of overcoming financial barriers and avoiding transaction costs. The countries with capital controls, unstable prices, trade barriers and little financial freedom will be prime candidates for spreading bitcoin among investors, as they are at high risk of confiscation of assets and the transfer of funds outside the control of the Government of the currency reduces these risks to a minimum.

Viglion howling in the study argues that there is a correlation between high levels of corporate taxes and the overall tax burden, between the prices that investors are willing to pay for bitcoin.

"From all this it follows that some investors may use bitcoin as an escape from repression and excessive taxation", - noted in the study.

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