With the COVID outbreak, the economy in Lao has been slowing down. Sadly, some of us lost their job, some companies closed doors permanently. The hospitality sector specifically is severely impacted. It will take months if not years to recover from this pandemic. Until then, some are considering making a career shift, some others are trying to find how to monetize their savings.
The cryptocurrency market is booming and represents an outstanding opportunity for those looking to make some money in the short and long term. Whether you are looking to become a full-time trader or simply find the best interest for your savings, we will walk you through a few simple steps to convert your Lao Kip into Bitcoin.
What is Bitcoin?
Bitcoin is a decentralized digital currency without a central bank. The currency can be sent from user to user or convert into Fiat money (government-issued currency like LAK) by using crypto exchange platforms.
Bitcoin is no longer reserved for hackers and terrorists and is starting to truly become a viable alternative for savings and investment purposes.
Large international companies such as Tesla, Paypal or Square are investing heavily in Bitcoin.
Mastercard has also recently announced that it will support selected cryptocurrencies in the near future:
The Bitcoin network is not only an infrastructure to store your money, you can also use it as a digital bank account with payment facilities such as credit card, international bank transfer, and so on. Companies like Crypto.com, Binance, or Nexo are already offering a credit card to enable you to pay your bills with your crypto wallet.
Where is my Bitcoin money stored?
If you decide to move your money into a digital currency such as Bitcoin or Ethereum, you do not become the owner of the Bitcoin tokens, you simply become the proprietor of private keys. These keys unlock access to your money and allow you to transfer/withdraw digital currencies. Your crypto money is not physically present anywhere, nor stored in any file or folder. This information is distributed and replicated across a network of computer machines, several thousand in the case of the Bitcoin network.
In that regard, access to your capital relies on these private keys. Nobody can take this money from you without these keys. These keys are the only way to retrieve the amount that you store on the blockchain. This is why it is extremely important to keep the crypto keys in a safe place. If you lose them, you will never be able to retrieve your assets.
With crypto, no government or private entity on earth can ever freeze or confiscate your crypto money. On top of that, the identity of the private key owner (aka you) is not known to the network. It is therefore completely secured and anonymous.
Is Bitcoin risky for my savings?
To be fully transparent, Bitcoin is a highly volatile asset. Its price is fluctuating constantly. The good news is that it is under massive adoption which means that its price keeps growing. Plus its volatility is reducing over time. In January 2020, one bitcoin was equal to USD $7,200. In March 2021, the same bitcoin worth USD $55,000!
In a nutshell, storing your money in bitcoin is a high-risk / high-gain strategy.
For those who can’t endure the risk, there are other cryptocurrencies to consider. Stablecoins for instance, are crypto-assets that copy the price of a FIAT currency (government-issued currency). USDT for instance copies US Dollar. The token’s pin to the USD is achieved by maintaining a sum of dollars in reserves that is equal to the number of USDT in circulation. To summary, if you convert USD $1,000 in USDT, you will receive USDT $1,000 that will still worth USD $1,000 tomorrow, in one month or in one year.
By converting your Lao KIP into USDT, you can keep them safe and secure. But you can still make money out of it. Exchange platforms like Binance allow you to “stake” your USDT with a 6% Annual Interest Rate.
The methodology to exchange Lao KIP with a stable coin like USDT or USDC is similar to the methodology to exchange Lao KIP with Bitcoin, we will see how to accomplish this later in this article.
In Lao PDR, companies usually pay their employees in Lao KIP – LAK by cash or bank transfer. So the big question is: how do I convert LAK into cryptocurrency such as Bitcoin to keep it safe and secure?
Buy Bitcoin using a Prepaid Visa Card in Laos
The top banks in Laos all offer the possibility to acquire a Mastercard or VISA card. These cards can be used for online payment or for travel purposes. BCEL, BFL or Indochina Bank are some of the banks in Laos that offer such services.
BCEL also offers a Virtual Prepaid Mastercard. This card is a top-up debit card. The customers must top-up the card first before making the payment for goods and services at the stores or online. The applicants can apply for the card online without filling the form at the bank. Plus, there is no yearly maintenance fee to hold the virtual card.
When your credit card is top-up, you can use it to buy crypto-currency directly on a platform such as Binance.
Binance is one of the most popular cryptocurrency exchanges. It was launched in 2017 and has kept growing since then. Its popularity comes from the wide range of cryptocurrencies that it supports, vast investment products available, and the low trading fees.
To buy crypto-currencies on Binance, you first need to register.
By using the referral link provided in this article, you will benefit from a discount on your trading fees.
Registering on Binance will require a straightforward KYC. Once you are registered on Binance, simply click on “Buy Crypto”, select the crypto that you wish to buy, and input your credit card credentials.
That’s it, your Binance account will be credited with your cryptocurrency. You can use Binance to exchange the crypto tokens into a different cryptocurrency as you please. Or you can create your own personal wallet and withdraw the funds from Binance to your own secured wallet.
If you would like to find a secured wallet to store your keys, check out this article:
Use a P2P network to buy crypto-currencies
A few months ago, Binance announced that it now supports LAK as a currency for P2P trading.
What that means is that you can now buy directly cryptocurrencies with your Lao KIP through the Binance platform. To do this, you do not need a credit card, you simply need to find someone that is interested to buy LAK in exchange for cryptocurrency.
Binance P2P trading platform makes this job easier than ever. Just go on Binance, go to Trade, P2P trading then click on buy. Select the currency that you want to buy, for example, USDT. Select the amount and currency that you want to change.
You will now find all the USDT sellers that are interested to buy LAK with the payment method. All the vendors will accept by default local bank transfers.
Binance acts as an escrow during the transaction. It means that once you initiate the crypto purchase, the crypto money will be locked on the seller account until the order is completed so you can transfer the funds without worrying.
Note that there are a lot of scams that go with P2P trading so be very careful. This article is a very good reference to make sure that you use P2P trading safely.