In 2020, President Bukele voted a legislative that stated Bitcoin in El Salvador holds the status of legal tenure. However, while the idea may seem ideal, the reality was far from beneficial. Here
What they did and why they did it – an overview
In June 2021, El Salvador brought itself an international spotlight. This comes in lieu of the country becoming the first country in the world to adopt Bitcoin as a legal tender. The President of El Salvador, Bukele headed a legislative vote that supported the implementation of a program wherein the cryptocurrency Bitcoin would become a legal tender of the country.
The move comes in the midst of the country’s dire financial position and a current GDP of less than $40,00. President Bukele hopes to improve the economic situation by adopting Bitcoin as an acceptable currency. However, while this plan may sound optimal it brought on a series of implications.
One year in how is Bitcoin in El Salvador faring?
Unfortunately for El Salvador, things do not seem to be looking up. According to IMF reports, the estimated cost of implementing the program of using bitcoin as a legal tender racked up to 1% of the country’s GDP. The IMF went on to urge the country to relieve itself of its Bitcoin dreams in hopes for a more realistic future.
One year into the implementation of this program, the financial position of El Salvador does not seem to be improving. This comes at quite a surprise when the country owns almost 2000 bitcoins.
Additionally, things do not seem to be looking too great for El Salvador or Bitcoin with the coin showing declining prices.
What the president claims is in store for 2022
As Bukele claimed when the legislation went into place, he continues to hope that accepting Bitcoin would open doors for many. This would allow unbanked citizens to enter the economy. Additionally, it would help reduce the difficulties in cross-border payment.
But what Bukele and most crypto enthusiasts fail to release is the most important part- the people do not want Bitcoin. More than 91% of Salvadorans opposed the idea and many took to the streets to protest.
However, there may be little hope for those in El Salvador, as 2022 saw a 10% increase in Bitcoin prices. Bukele claims that this is just the beginning of Bitcoin’s rise.
