Opinion by: Carel van Wyk, CEO of MoneyBadger
“Hodl” is the rallying cry for a lot of within the typical Bitcoin group as a result of they imagine they need to spend “dangerous cash” (fiat) and hoard “good cash” (Bitcoin) as it could respect in worth. However they misunderstand Gresham’s Law, which says, “Dangerous cash drives out good,” as a result of at present, there isn’t a purpose to have dangerous cash in any respect.
There’s a elementary drawback with the hodl strategy, notably in international locations the place the native fiat is beneath siege, like South Africa.
It results in folks and governments seeing Bitcoin purely as a long-term financial savings asset, not a transactional foreign money. That is in direct distinction to Satoshi Nakamoto’s original white paper, “Bitcoin: A Peer-to-Peer Digital Money System.” It additionally instantly contributes to Bitcoin’s (BTC) lack of broad adoption and use.
Saving vs. spending
Saving — aka hodling — all the time fulfills a specific function: to assemble sufficient cash to purchase a home, a sports activities automobile or possibly early retirement. Even should you’re saving your “good cash,” you’ll nonetheless must convert it into fiat to pay for that home, automobile or early retirement.
Spending, against this, creates market demand for retailers to simply accept Bitcoin, strengthening Bitcoin’s utility and adoption. It additionally makes it simpler for folks and regulators to see Bitcoin as helpful, sensible cash.
Associated: Bitcoin is ‘made for us’: Africa’s first treasury company eyes unique opportunity
Proper now, Bitcoin has an adoption drawback: Fanatics push retailers to simply accept Bitcoin (“orange-pilling”), however no one spends it as a result of they’re hoarding Bitcoin. In response, pissed off retailers cease accepting Bitcoin, and it turns into arduous to persuade them to start out accepting Bitcoin once more. For instance, South African cost processor PayFast accepted Bitcoin way back to 2014 however dropped it 5 years later on account of low utilization.
Some say “simply wait,” and that adoption will occur naturally when Bitcoin holders grow to be rich sufficient. If no one spends Bitcoin at present, nevertheless, it won’t turn into usually accepted cash tomorrow.
It’ll stay “simply” an funding car, and regulators will proceed to limit its use as foreign money. “Simply wait” additionally means hoarding Bitcoin whereas fearing short-term worth drops, which makes you quick Bitcoin at present.
A greater technique is to maintain saving and begin spending. Have two wallets — one for financial savings, one for spending. (This additionally helps together with your taxes. Extra about that later).
Spending builds the system
Why hassle spending Bitcoin should you solely need to construct your fiat reserve? Utilizing Bitcoin for normal purchases (groceries, espresso, small luxuries) reinforces Bitcoin’s use as a money system, as meant. As extra Bitcoin house owners use their Bitcoin for each day purchases, it alerts retailers to the untapped market of Bitcoin spenders they’ll appeal to.
This encourages extra retailers to supply it as a cost choice, which opens up new avenues for Bitcoin penetration. Pockets suppliers can launch incentive applications and provide reductions on spending, driving extra gross sales for retailers. One South African supplier, for instance, provided 10% again in sats for procuring at Decide’n Pay, and Binance presently offers 50% again for any QR-code-based cost to a South African store. Plus, utilizing Bitcoin to pay instantly saves time and reduces prices, as customers keep away from alternate charges, financial institution delays and conversion hassles.
Granted, one of many strongest sensible arguments towards spending Bitcoin is that every transaction have to be included in your tax calculations, which results in extra difficult tax returns. Sooner or later, we might even see a rational strategy from tax authorities, just like the Australian Taxation Workplace’s view that crypto is an untaxed personal-use asset when it’s used for day-to-day spending.
Significant Bitcoin adoption. I’ve realized rather a lot about that this yr from working with Nigeria, conversations about Argentina, and, extra not too long ago, South Africa.
👇Incredible chat with @gazza_jenks @staffordmasie @BitcoinEkasi @carelvwyk @MoneyBadgerPay https://t.co/aroYcyKTDY
— Robert Baggs (@rkbaggs) September 19, 2025
Within the meantime, the sensible resolution for taxpayers in international locations with out Australia’s foresight is twofold. First, cut up your Bitcoin into one pockets for financial savings and one for spending, after which use automated tax calculation software program to maintain observe of all of your Bitcoin transactions. This simplifies your tax calculations and satisfies regulatory necessities.
The private is political
Many individuals and crypto influencers deal with changing into wealthy in fiat phrases and neglect about Bitcoin’s unique function. Bitcoin was designed to be a impartial, open-source type of cash that’s world, censorship-resistant and permissionless.
This leads us into the world of laws, formed by how folks interact with new, disruptive applied sciences like Bitcoin. Bodily spending Bitcoin at a grocer or espresso store teaches you simply how briskly, simple and empowering it’s in comparison with fiat. Bitcoin funds are sometimes processed sooner than a bank card for a similar buy.
But in October 2022, the SA authorities categorized Bitcoin as a “monetary instrument” (however not as cash) as a result of that’s how most individuals see it. SA Reserve Financial institution deputy governor Kuben Naidoo mentioned, “We aren’t intent on regulating it as a foreign money as you possibly can’t actually stroll into a store and use it to purchase one thing. As an alternative, our view has modified to regulating [cryptocurrencies] as a monetary asset.”
Bye-bye shopping for your self a self-custody cappuccino with out filling in cross-border cash switch types.
Service provider activation initiatives change the narrative by enabling real-world utilization. Spending Bitcoin then shifts from purely monetary motion to activism for financial freedom. Proper now, we see a continued enhance within the quantity of crypto transactions in essentially the most distinguished bodily retailers and on-line e-commerce shops in South Africa.
Of those transactions, 67% are Bitcoin, adopted by Tether’s USDt (USDT) (15%), XRP (XRP) (8%) and Ether (ETH) (4%). This comes as no actual shock. The geographies the place Bitcoin is used most as a retailer of worth and as a medium of alternate are additionally these the place native foreign money is most in danger.
In South Africa, now we have a number of the most restrictive foreign money controls on the planet, and we face the erosion of personal property rights and guarantees of increasing authorities spending past what the financial system can help. This evokes fears of hyperinflation, as occurred to our neighboring nation, Zimbabwe, leading to South Africans of all walks of life seeking to different types of cash to isolate them from the gradual however regular decline of the rand. An instance is the circular Bitcoin community blossoming alongside the Backyard Route, one in every of South Africa’s key vacationer locations.
We’re already seeing the impact of the regulatory authorities’ one-sided views. As an illustration, crypto cost service firms in SA have had their license functions delayed since November final yr.
That’s as a result of the Monetary Sector Conduct Authority (FSCA), which points monetary instrument licenses, is attempting to work inside regulatory tips that don’t presently contemplate crypto a “technique of cost” however solely as a “monetary instrument.” Many crypto cost service firms provide extra than simply wallets or exchanges (the “monetary devices”); they facilitate funds, too.
There’s presently no licensing regime for crypto funds, nevertheless, so the FSCA is not sure whether it is legally in a position to subject licenses. Regulators are presently attempting to resolve this deadlock by way of the SA Reserve Financial institution’s Nationwide Fee System division, delaying the issuing of licenses. Equally, there isn’t a remaining decision on whether or not cryptocurrencies fall beneath South Africa’s alternate management insurance policies, and court docket circumstances like the present Normal Financial institution vs. SARB case will proceed for years.
Bitcoin’s future usefulness brings to thoughts Charles Dickens’ opening line of “A Story of Two Cities,” his epic novel set simply earlier than the French Revolution: “It was the most effective of occasions, it was the worst of occasions, it was the age of knowledge, it was the age of foolishness, it was the epoch of perception, it was the epoch of incredulity.”
Resolve your perception: Ought to Bitcoin be cash or only a speculative asset? Or can or not it’s each?
For those who imagine in Bitcoin as cash, use it as cash, reserve it and spend it such as you do cash. As a result of proudly owning Bitcoin that retains on growing in worth — however by no means utilizing it — is like proudly owning a sports activities automobile you by no means drive.
Oh, and people two wallets? No person is saying “spend your stack.” View your financial savings pockets as your “quantity go up” stash and your spending pockets as your “make a distinction” fund. After which do your bit for the revolution.
Adoption doesn’t occur by hoarding. It occurs by spending. You’ve hodled. Now go spend.
Opinion by: Carel van Wyk, CEO of MoneyBadger.
This text is for normal info functions and isn’t meant to be and shouldn’t be taken as authorized or funding recommendation. The views, ideas, and opinions expressed listed here are the writer’s alone and don’t essentially replicate or symbolize the views and opinions of Cointelegraph.
