According to Economic Confidential blog " IMF says, Crypto Assets May Displace Local Currencies in Developing Countries". Source: Economic Confidential, Facebook page..
Bitcoin is taking over the internet for online transaction, therefore, most of the local currencies in the developing Nations are affected.. because developing Nations are not inclined in the e-currency transaction while the new generation youths use the e-currency for transactions. That making the local currency weak.
Can Bitcoin really weaken the Local Currencies in the Developing Nations?
I don't think it would weaken them. I believe it would usurp them, in a good way though even that word means not. And that would probably be a net positive for that state. They wouldn't have as high as inflation rate, and could save money on transfer fees. Be borderless. Be decentralized. The list goes on and on. El Salvador will tell us a lot, and I believe it will be positive for sure.