Nayib Bukele has become a popular figure among cryptocurrency proponents since last year. He decided to take the bold step to make Bitcoin a legal tender in the country in 2021. Bukele has also shared plans like Chivo wallet, Bitcoin ATMs, a geothermal power plant, and building a new free trade zone called Bitcoin City along the coastline of the country.
The country has decided to keep adding more Bitcoins to its reserves every time the market undergoes a correction. Recently, Bitcoin prices plunged to 6 months low. Wasting no time, Bukele put an update on Twitter about buying from the dip. The tweet also revealed that the country has purchased another 410 Bitcoin for $15 million recently. The total Bitcoin reserve for El Salvador now stands at 1,801 tokens.
The biggest motivation for Bukele for introducing Bitcoin in the region was to make financial services available to the largely unbanked population. Furthermore, Bukele also pointed out that the country stands to save billions of dollars spent on transaction fees every year with Bitcoin network payments. Bitcoin City is a tax-free zone that encourages cryptocurrency entrepreneurs to invest in the country and make the citizenship process easier for them.
However, not everyone was excited about the Bitcoin adoption plans. The local citizens and businesses protested against the sudden monetary transition claiming that using Bitcoin was not easy for them and only made the lives of the super-rich easier. Some protestors burned tires in front of the Supreme Court in San Salvador to register their protest.
Like many developing countries, El Salvador is also applying for monetary aid from IMF. The country is currently in the process of negotiating for a 1.3 billion dollars loan. The IMF officials have expressed their reservations about the Bitcoin adoption. Some officials even ridiculed the process by calling it a good experiment.
Meanwhile, Moody’s report added Salvador to the Caa1 category, classifying it as a high credit risk country. A financial report by Al Jazeera cited that the country’s national debt has taken up about 50% of its GDP last year. Meanwhile, president Bukele who identifies as the CEO of Salvador on Twitter has continued to go forward with his Bitcoin plan unscathed or bothered by all the setbacks.