So back in June, you might’ve heard that the small nation of El Salvador in Central America was looking to adopt Bitcoin as legal tender, requiring local shops and businesses to accept the cryptocurrency as an accepted form of payment. Well, it’s just gone into effect yesterday and lo and behold, even the McDonald’s in El Salvador have had to adapt.
But while restaurants and stores in the Latin American country move to adopt cryptocurrency payments, El Salvador’s Bitcoin currency launch hasn’t exactly gone smoothly. A number of Salvadorans have been protesting the move, with a leading cryptocurrency expert even getting arrested by authorities after he had publicly criticised the initiative.
Furthermore, the World Bank has also highlighted their concerns, while credit rating firm Moody’s downgraded El Salvador’s rating following the government’s move to make Bitcoin legal tender. Even the cryptocurrency itself wasn’t safe from El Salvador’s adoption of it, as Bitcoin actually took a massive dip in value the moment it became legal tender in the country, going from USD52,000 per 1 BTC to just over USD43,000, before recovering to USD46,292 at time of writing.
El Salvador’s ‘Bitcoin Law’ is the result of Nayib Bukele, their 40-year-old president who leads the populist Nuevas Ideas party. According to Bukele, the move would not only generate jobs and provide financial inclusion to thousands of Salvadorans, but also help make it easier for those living abroad to send money back home. President Bukele also hopes to see it lead to more investment and tourism in the country.
There’s also plans to give every Salvadoran USD30 in BTC via an app called the Chivo Wallet, but that app was hit by numerous technical issues following its launch on Tuesday. President Bukele even had to tweet out an apology of sorts, promising to improve the user experience and calling for feedback, while also announcing a temporary suspension of Chivo Wallet while authorities work on fixes.
While Bitcoin being legal tender in El Salvador is off to a rocky and uncertain start, one thing that’s for certain is that it’s a big gamble by President Bukele, and how it plays out remains to be seen.
