El Salvador become the first country to accept Bitcoin as legal tender
Alongside the US dollar, Bitcoin will be accepted for payment and is recognized by the government of El Salvador. Besides, excitement for the new digital coin, there is fear among people.
Though El Salvador has become the first country to introduce, and accept Cryptocurrency as legal tender, there is debate around the globe about the danger and opportunities of the currency.
BENEFITS OF DOWNLOADING NEW DIGITAL WALLET
The government is offering $30 in Bitcoin to every Citizen who downloads the government-backed new digital wallet app. The government is giving the initial dollars to encourage the adoption of the new currency.
Whereas Bitcoin fans around the globe have been buying digital coins worth $30 to show support and to encourage the volatile currency.
The government is expected to save the country almost $400m a year in transaction fees on funds send from abroad. However, BBC reports using data from the government and World Bank shows the amount is closer to $170m.
President Bukele tweeted, ‘’ we must break the paradigms of the past, El Salvador has the right to advance towards the first world.’’
People are also worried about Cryptocurrency, as its value changes drastically over the last year. It went from about $10,000 for a single coin to a high of $60,000 in April 2021 and then falling to $30,000 in July this year.
Crypto uncertainty raises questions regarding using it as legal tender. In a survey led by the Central American University (UCA), only 4.8% of the 1,281 people understood what Bitcoin was, and its use. Meanwhile, 68% of those said that they disagree with the use of Cryptocurrency as a legal tender.
PROTEST AGAINST BITCOIN AS LEGAL TENDER
Protestors in the capital of San Salvador showed a lack of confidence and consider it a controversial rule. Ed Hernandez a shopkeeper in San Salvador told BBC that he is truly on board with the decision.
Opposition politician Johnny Wright said, ‘’ It was a very bad day for president Bukele, his government and Bitcoin experiment’’.
He further added, ‘’ the majority of the population knows very little about Cryptocurrencies. What we do know is it’s a very unpredictable market. Today that was surely made manifest.’’
Bitcoin law was approved in the parliament of El Salvador, and it hardly took only five hours to get through it.
‘’ We are not Cryptocurrency or Bitcoin Haters, but we don’t believe that it should be compulsory that businesses be obligated to accept Bitcoin in payment.’’
Beyond the fear of the adoption of bitcoin and financial instability, illicit transactions could also fuel financial issues.
