El Salvador: Between Bitcoin Adoption and Dollar Attachment

Key facts

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  • Government retrofits infrastructure to facilitate cryptocurrency use.

  • A few days after the law came into force, discontent persists among sectors of the population.

Next September 7, El Salvador’s Bitcoin Law comes into force. This means that, within a week, the Central American country will become the first in the world to adopt the cryptocurrency as legal tender. It will be the moment when the experiment that will use the cryptocurrency as a determining factor in transforming the nation’s struggling economy takes off.

Since President Nayib Bukele announced last June that El Salvador would adopt bitcoin as legal tender, the country has been the center of attention for bitcoiners and industry enthusiasts. The fervor has even rocked El Zonte, a fishing community that pioneered the use of the first of the cryptocurrencies, which has become an unexpected hotspot for tourists.

As September 7 approaches, preparations for the law to go into effect are also accelerating, as by that time Salvadorans will have several services

available for the use of the cryptocurrency. Among them are 50 “Puntos Chivo” which are several branches distributed throughout the country where you can deposit and withdraw money without commissions. In these attention booths there will be trained staff to advise the use of the government wallet and bitcoin ATMs. El Salvador: Between Bitcoin Adoption and Dollar Attachment El Salvador: Between Bitcoin Adoption and Dollar Attachment The Chivo Points have bitcoin ATM and will be available to the public 24 hours a day, 7 days a week. Source: Twitter/ Nayib Bukele.

Bukele says that the Bitcoin Law will benefit the population who will save about USD 400 million in commissions on remittances. In addition, it will guarantee instant and more secure financial transactions.

“A Salvadoran abroad will be able to send money instantly to his relative in El Salvador. You can send bitcoin, if you want, or you can send dollars, if you want. If not, he can always go stand in line at Western Union and pay commission. There is no problem.

Nayib Bukele on Twitter

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Meanwhile, some merchants are refusing to receive bitcoin payments, while others, such as Pizzeria Perronas and motorcycle shop <a href=”https://fb.watch/7Jn4wl1XIw/” target=”_blank” rel=”noo

pener”>Power Cycles, say they have begun to accept it without problems.

On Twitter, hundreds of users express their support for the measure promoted by Bukele, among them there are those who believe it will bring benefits to the population and others applaud the transformation of the country that is already underway.

Protests continue in rejection of the Bitcoin Law

But the Bitcoin Law is not accepted by all sectors of society, so demonstrations and protests against the measure are frequent. The most recent of these occurred last Saturday, August 28, when hundreds of workers, war veterans and retirees marched through San Salvador to express their concerns about the use of cryptocurrency.

They are concerned that, under the law, their pensions and other benefits will be paid in bitcoin instead of the U.S. dollar. They also believe that the majority of the population does not have enough information to use the cryptocurrency.

The protest had about 900 people who gathered in front of the University of El Salvador to express their rejection of the Bitcoin Law and request an increase for the benefit they receive which is in the order of USD 100, as digital media reviewed.

20 years ago the Legislative Assembly of El Salvador approved the Law of Monetary Integration that meant the implementation of a dollar standard. It was believed that, in this way, the country would achieve greater economic stability, however, today its international reserves are diminished and poverty is growing at an accelerated pace.

The U.S. Federal Reserve can adjust the supply of dollars as it sees fit, and El Salvador, without a voice in this measure, may face inflation if it continues to depend on the dollar.

“The purpose of this law is to regulate bitcoin as an unrestricted legal tender with liberating power, of limited supply, and in any title that natural or legal persons, public or private, require to carry out,” the Bitcoin Law states.