$51B leaves the US in the form of remittance -- imagine all of that being USD->BTC->USD instead. The daily trade volume would be astronomical compared to today's.
Where remittance ends, forex begins.
Where remittance ends, forex begins.
Sell and redeem your asset for local peso deposits in Mexico. The vast diaspora will use their accounts at home to buy the asset then sell them p2p in the US to their community network. Traders all over Mexico can change the asset to cash p2p using your business as guarantee the assets are worth something. No correspondent banks to worry about. Now somebody in the US can load up your version of counterwallet.co, click on p2p trade and buy your asset from somebody local either for cash or bitcoins to send to their family back home or directly to a cash out service in Mexico that just delivers money.
Exchanging between bitcoin and local currency is somewhat difficult and incurs fees. In fact, in the US one of the key reasons it is difficult is that government is naturally trying to close off this potential loophole, because that's what organizations of this nature do -- really this brings us back to the issues of control that are raised by the original link.
It would be interesting if this kind of increasing pressure on financial gateways led immigrants to start demanding payment in bitcoin, but there's no sign of that happening yet. They need to be familiar with it first.
Immigrants have an extremely limited selection of places to spend bitcoin in their home countries. Though if the demand existed, then the market would grow. Ironically, the most developed bitcoin economies are the US and Europe. In the US, there is a pretty wide selection of goods available, thanks to big retailers like Overstock and Newegg, but even there, one is still limited to a small subset of stores.
* edit: I should add that, with the current state of the software, it's not the safest way for an average person to handle large amounts of money. Obviously, there's lots of potential for improvement there.
It's not going to happen overnight, but if USD transfers gets too expensive and difficult, it's a natural outlet. And I'm sure illegal money transfer services will spring up to (have a pile of drug money in Mexico and want to move it into the US without the complexity of moving the cash? Sell money transfer from the US to Mexico)
This year, I've been shopping for phones again in Mexico. Every network and every shop is full of nothing but smartphones. Almost all monthly plans come with data. Accessory shops with cases and covers and headphones and stuff exist in every town.
Mexico's bitcoin infrastructure is ready to take over the money transfer business if the government and the banks make it hard or expensive to go through official channels. All it will take is enough expense to make it worth learning to use bitcoin. The network of small entrepreneurs that would do the actual cash exchange already exists: Mexico is a land of small shops and informal businesses.
Erecting arbitrary barriers is more likely than ever to create a black market.
Extreme volatility is also irrelevant if the alternative is for your money-less family in some other country to receive no money, or once the hoops you have to jump through to do it legally with USD gets too difficult.
I don't know what that price is, but if it's higher than what banks and money transfer companies are charging, Bitcoin is the more expensive alternative.
Actually, to price it, you need to find out how much you would need to pay someone to take on that risk (i.e. the cost of hedging the risk). If people's willingness to pay to avoid the risk is higher than the cost of hedging it, then you have a profit opportunity.
This isn't Bitcoin specific but getting both in two adjacent sentences was a good opportunity to comment on it.