Land Expropriation & Bitcoin Searches Seem To Have a Positive Correlation in South Africa
The newly instated South African president, Cyril Ramaphosa, has wasted no time in pushing his agenda of land expropriation. Ramaphosa had his wishes granted when the Parliament of the Republic of South Africa, on 27th February 2018, passed a motion to allow seizure of land from white farmers without compensation. Interestingly, this seems to have had an impact on the Bitcoin search trend in South Africa.
Land expropriation is not a new idea. Zimbabwe did the same in the 2000s and suffered several economic repercussions. This article is neither going into the history of this issue nor the right or wrong of it. We will instead focus on something that cannot be confiscated by governments and why web searches for it have gone up in South Africa.
The Bitcoin Connection
There is a clear correlation between searches for bitcoin online and its price movements. According to the SEMrush cryptocurrency study on search volume trends, the chats of both web searches and price follow similar trends. It is, however, difficult to tell which is the chicken or egg. It is unclear whether the increase in search numbers causes surges in the Bitcoin price or vice versa.
Back to the seizure of land story. If you were a white South African farmer at the moment, you would probably consider selling some land after hearing the news. Leaving South Africa would definitely have crossed the minds of many white farmers as well. Hiding property is also a natural reaction to such news. This is where Bitcoin comes in.
People who find themselves in situations similar to that of the white farmers can turn to Bitcoin for insurance. Unlike farm lands, buildings and money in bank accounts, Bitcoin cannot be seized by the government if handled properly. Maybe, this is the reason for the increased number of searches for Bitcoin in South Africa.
Indications From Google’s Bitcoin Search Trend Statistics
Above: 12-month worldwide Bitcoin search trend from Google trends
Above: 12 month South Africa Bitcoin search trend from Google trends
A quick look at the two charts shows that the number of searches for Bitcoin in South Africa has been increasing since 4th March. This was a reversal from the general downward trend in recent times. During the same period, the Bitcoin search trend of the entire world remained in a downtrend. This difference in trend is the only exception when comparing both trends over twelve months. This backs the assertion that the vote to allow the seizure of white farmers’ lands might have led an increase in the interest in bitcoin.
Other Possible Explanations
The recent Blockchain Africa Conference held in South Africa on 8th and 9th March 2018 could also have contributed to the increase in web searches for bitcoin in South Africa. This could be far-fetched since the conference attracted just hundreds of people. The timing of the conferences, however, falls within the same dates of the increases in web searches. There is the possibility that the buzz surrounding this annual conference could also be a contributing factor.
No certain conclusions can be drawn here. However, the correlations are interesting and worth looking at. If state actions like this can lead to more in interest in Bitcoin, then we have yet another reason to be bullish. We can count on governments to take actions like this every now and then.