As Greece formally defaults on a US$1.7 billion payment to the International Money Fund, Greeks are turning to bitcoin in the face of a potential exit from the euro.

Bitcoin exchanges around the world have seen a surge of business from Greece.

German exchange Bitcoin.de said its Greek user base has been multiplied by 10, while UK-registered Bitstamp, the world’s third largest bitcoin exchange, has seen a 79% growth in trades from Greece, reported CNN.

Polish exchange Bitcurex said it got flooded with emails from Greeks, who asked if “Bitcoin is a legal currency in EU,” if they can “use Bitcurex as a bank account,” or even if Bitcurex has “a bitcoin ATM network in Greece.”

The trend isn’t limited to European and North American bitcoin exchanges, as Chinese LakeBTC said it has seen a 40% increase in visitors from Greece.

Coinbase, one of the most well funded startups in the space, said it has seen a “300% increase in bitcoin buys across Europe.”

“One of the main benefits of bitcoin is that it allows people to take control of their own wealth,” the company wrote in a blog post.

Fred Ehrsam, co-founder and president of Coinbase, told Fortune:

“There’s little that [bitcoin companies] can do for people on the ground in Greece. The bigger deal here is if you’re sitting in Italy, Spain, or Portugal, and you’re getting a little nervous, maybe it makes some sense to put value into bitcoin where you’re less susceptible to these things. The doomsday way of saying it would be, ‘Do it before it’s too late.'”

Earlier this week, Greece shut its banks and imposed drastic capital controls, limiting daily cash withdrawals to 60 euros and banning payments and transfers abroad.

Bitcoin, which is entirely independent of government involvement, is gaining popularity among Greeks who are desperate to regain access and control over their money. But obtaining bitcoins in the country is still a challenge.

Currently, there is only one bitcoin ATM located in a bookstore in the city of Acharnes. However, individuals can still conduct face-to-face transactions via services such as LocalBitcoins.

Meanwhile, the price of bitcoin has shot up during the past few weeks. Bitcoin, which is currently traded at 257 USD/BTC, based on Blockchain.info data, has experimented a 17% growth over the past month.

Steady slide toward Grexit

This morning, the IMF confirmed that the Greek government has failed to repay its US$1.7 billion debt due by 11pm last night.

Unless Greeks vote in favor of the most recent bailout offer from Europe and the IMF, Greece is likely on the path out of the eurozone.

According to analysts, Greece’s citizens would see a 40% drop in their purchasing power if the country replace the euro with its former currency the drachma.

Valentin Marinov, head of Group-of-10 currency research at Credit Agricole CIB, told Bloomberg:

“One of the reasons we believe that the Greeks want to stay in the euro, and will ultimately do, is the heavy economic toll that their economy will have to pay under Grexit. […] Depreciation involved is of the magnitude of 40 percent against the dollar [after 12 months].”

Image credit: Pixabay

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