What is Xenocurrency? Example and Invest with Xenocurrency

Definition of Xenocurrency

“Currency that trades outside its external borders” “Xenocurrency is a currency that circulates or trades in markets outside of its domestic borders. The name derives from the Greek prefix “xeno,” meaning foreign or strange.”

What is Xenocurrency?

Xenocurrency is a currency that is used outside the boundaries of the currency concerned. The term comes from the Greek ” xeno ” which means outside or foreign. In simple terms, xenocurrency is funds held in foreign banks or used outside of the original origin of the money.

Xenocurrenct was first introduced by Fritz Machlup – an Austrian -American bloody economist in 1974. Initially, the term was used as a phrase to refer to savings and loans deposited in countries other than the original place of origin of the bank.

Currently, the term xenocurrency is rarely used because of the negative view of the term xeno which is often associated such as xenophobia – the fear of foreign things. The term that is now more popularly used is foreign currency.

Xenocurrency Example

A number of rupiah money is deposited in a bank in Singapore and then used for transactions there. In this case, the rupiah-denominated fund is referred to as xenocurrency in Singapore.

Another example of xenocurrency that often occurs in the world is the United States Dollar (USD) currency which is used in Mexico, especially for the purchase of luxury properties or certain business activities.

Invest with Xenocurrency

Some people use xenocurrency as an instrument for investment. However, this can be very complex and risky because in addition to having to take into account the amount of profit from the funds obtained, it must also take into account the exchange rate between the origin of the currency and the currency in which the funds are located.

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