El Salvador was serious when it said it was making bitcoin a legal currency within its borders, and anyone who didn’t believe the nation’s regulators are likely getting a good kick in the pants right about now.
El Salvador Is Moving Up the Crypto Ladder
The Central American country has begun rolling out bitcoin ATMs to begin allowing individuals to trade their crypto for fiat and vice versa. Thus far, about 200 separate machines have been installed. The country is still very dependent on the U.S. dollar, though members of El Salvador’s executive branch believe this will eventually cause customers to seek more autonomy and become more open to digital currencies.
El Salvador is the first nation in the world to make such a move with bitcoin. For the most part, BTC (the world’s primary form of cryptocurrency) has largely been seen as either a speculative product or as a hedge tool; something that could potentially keep a person’s wealth and money safe and secure during times of economic strife. However, very few individuals – much less countries – have ever viewed bitcoin under a “currency” lens given that the asset has had a very difficult time beating out the volatility it’s become known for.
Bitcoin goes up and down with such speed, it has barely had any time to be recognized as official money by stores, retailers, and similar establishments. However, El Salvador has quickly shown it is willing to make the first move. The country was the first to establish bitcoin as legal tender within its borders, a decision that has come with a certain level of controversy.
For example, the nation was eager to gain assistance from the World Bank in setting up its present bitcoin agenda, though the financial institution ungraciously said “no,” citing the price swings bitcoin is known for as the reason why. The World Bank deemed bitcoin too risky, and thus in good conscience could not offer any advice or reasoning to El Salvador.
However, the country defied the Bank’s initial orders and moved forward with its plans on its own, eventually garnering advice from the likes of the United States and several other leading nations as it went along.
Using Bitcoin Like Any Other Form of Money
The current machines being installed on the nation’s streets will accompany the Chivo wallet, a digital wallet system designed for everyday citizens to hold and store bitcoin and other cryptocurrencies. Chivo is local slang for “cool” or “hip.” Regulators have also made it clear that stores and retailers cannot discriminate against any customer wishing to pay for items or services with BTC. If a person walks into a store with BTC, they must be given the same consideration and respect as those paying with USD.
The country’s new bitcoin acceptance laws are set to become active on September 7 of this year.