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June 28, 2022
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El Salvador will officially adopt Bitcoin as its legal currency on September 7

Bitcoin will become legal in El Salvador’s everyday economy.

Payment processors that facilitate the immediate transfer of fiat currency cryptocurrencies and enable the acceptance of Bitcoin (BTC) payments for e-commerce, point of sale, billing and shipping have a finger on the pulse of the daily economics of cryptocurrency adoption .

The crypto payment gateway, Triple A, summarized what El Salvador’s adoption of Bitcoin as the official currency on September 7 means for the local economy.

everyday life transactions

“The use of Bitcoin will be optional and no one will receive Bitcoin if they don’t want to… If someone receives payment in Bitcoin, they can choose to automatically receive it in dollars,” said El Salvador President Nayib Bukele, who also assured citizens that the pensions and salaries will continue to be paid in US dollars.

As Bitcoin becomes the official currency of El Salvador, along with the US dollar, businesses in the country will accept it for payments for goods and services, while citizens will be able to choose to pay their taxes in cryptocurrencies.

As the majority of El Salvador’s citizens surveyed are skeptical of the new official currency and international financial authorities continue to increase global uncertainty around the adoption of cryptocurrency, the potential relief for a local economy that needs a boost is forgotten .

The country has a population of 6.5 million, with more than 2 million living abroad and still sending money home, with more than 20% of the country’s gross domestic product (GDP) made up of remittances.

In terms of remittances as a share of GDP, the top five recipients in 2020 were smaller economies, including Tonga, Lebanon, the Kyrgyz Republic, Tajikistan and El Salvador.

“In the first half of 2021, El Salvador received $3.6 billion in remittances. An increase of 45.3% compared to previous years.

They account for 23% of the country’s GDP and benefit around 360,000 families, with 95.4% sent from the US.

El Salvador needs #Bitcoin”

Infrastructure for financial inclusion

Adopting Bitcoin as the official currency will allow you to bypass expensive and slow traditional remittance companies, but it will also open up financial services to 70% of the country’s citizens who do not have a bank account.

To drive Bitcoin adoption and facilitate financial inclusion, Bukele has pledged to develop the necessary infrastructure, including creating a Bitcoin wallet called Chivo, while offering $30 in cryptocurrencies to citizens who download and register.

In addition, Athena Bitcoin announced a $1 million investment in installing 1,500 cryptocurrency ATMs across the country, while focusing on areas where residents receive remittances from abroad.

Both the new wallet and crypto ATMs would allow instant conversions, guaranteeing freedom of choice over payment options, recently challenged in a public protest against Bukele’s Bitcoin account.

Source: cryptoslate

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