El Salvador is pushing for the use of Bitcoin with ATMs, digital wallets and free money — but participation is not ‘mandatory’
Press Secretariat of the Republic of El Salvador/Twitter
El Salvadorplans to launch its own digital wallet and give $30 worth of Bitcoins to every citizen who signs up once its new Bitcoin law comes into force on September 7.
- It has also roped in US-based firm Athena to set up 1,500 cryptocurrency ATMs in the country.
- El Salvador’s President Nayid Bukele believes there’s a ‘dirty campaign’ at work spreading misinformation about the country’s new move.
AdvertisementEl Salvador’s President, Nayid Bukele, is leaving no stone unturned in trying to get the country’s new crypto-based economy off the ground. But, he dismissed rumours that the use of Bitcoin will be mandatory for the country’s citizens.
The use of bitcoin will be optional, that is, no one will receive bitcoin if they do not want it for any type of payment.
Before the country’s new Bitcoin law kicks in on September 7, the government has announced the release of a new official digital wallet — called Chivo — for citizens to store their Bitcoin and other digital currencies.
Once they sign up, every citizen will receive $30 worth of Bitcoin once registration is complete, according to local media reports.
El Salvador’s crypto economy is also getting an upgrade with 1,500
Bukele blames a ‘dirty campaign’ for the FUD being created around El Salvador’s adoption of Bitcoin
El Salvador’s president believes that there’s a ‘dirty campaign’ at work creating fear, uncertainty and doubt (FUD) around Bitcoin’s usage in the country. According to Bukele, merchants will have the freedom to choose whether or not they want to conduct their business in Bitcoin or dollars.
The use of Bitcoin is not mandatory and wages as well as pensions will continue to be paid in dollars. “There has been a bit of a dirty campaign on the subject, saying that salaries and pensions will be paid in Bitcoins, but this is not going to be the case,” he said dismissing the rumours.
Bukele added that bank accounts with dollar deposits will continue to remain in dollar currency. It will be up to individuals to decide whether or not they wish to convert their holdings into Bitcoin but it is not mandatory.
He reiterated that the dollar will continue to function alongside Bitcoin. El Salvador is not replacing one with the other.
AdvertisementHowever, this hasn’t stopped the opposing political party from filing a lawsuit that alleges the new Bitcoin law is unconstitutional and will be harmful to the country.
El Salvador’s new ‘official’ digital wallet
Rather than depend on third parties or exchanges, El Salvador’s president has announced a new ‘official’ digital wallet for its citizens. This means that the government will be responsible for making sure that the digital assets stored within that wallet are safe.
Chivo is an app that will work on any Android and iOS device. It will come online when the country’s new Bitcoin law comes into effect on September 7.
1,500 new cryptocurrency ATMs
Athena currently has two locations where Bitcoin ATMs are already operational in the country. One is located at El Zonte beach as part of the ‘Bitcoin Beach’ experiment and the other is a mere 11 kilometers away at El Tunca.
First #Bitcoin ATM in #ElSalvador. #ElZonte @PeterMcCormack @costaviva_sv @nayibbukele #surfcity https://t.co/V8ZRM8RE2Y— Chivo Beach (@Bitcoinbeach) 1580853257000
In a bid to get the use of Bitcoin off the ground, not only is Athena installing 1,500 new cryptocurrency ATMs across the country but it will also open a local office and hire staff to carry out operations in El Salvador.
1,000? How about 1,500?#BTC♻️ https://t.co/PDApT7M7T5— Nayib Bukele (@nayibbukele) 1623884517000
Athena’s $1 million will target regions where residents receive remittances — money that relatives living abroad send back to their families in the country. It is one of the highest contributions to El Salvador’s Gross Domestic Product (GDP). And, the legalisation of Bitcoin is meant to help with those transactions by making them easier and faster.
One of the reasons we passed the Bitcoin Law is precisely to help people who send remittances
El Salvador still has a digital divide it needs to address
AdvertisementThe trade sector in El Salvador is mostly informal. And, it’s one of the largest informal sectors in the country. This results in the lion’s share of commercial activity being off the grid and without access to technological resources.
To fix the digital divide, the government will be training the country’s merchants — large and small — on how to use cryptocurrency. "The state will promote the training and the necessary mechanisms so that the population can access the benefits of bitcoin transactions. Therefore, the State will improve the network connectivity," said Bukele during the national broadcast.
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