Tuesday, 7 September Bitcoin law enters into force in El Salvador

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Editorial Dept. Voz de la Diaspora

The Savior – This Tuesday, 7 September, the Bitcoin Law enters into force in El Salvador, which will become legal tender together with the US dollar.

Despite the opposition of a large part of the citizenry according to the results of public opinion polls, the government of President Nayib Bukele says the measure is irreversible.

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With little information on the use and benefits of cryptocurrency to the population, el gobierno ha distribuido cajeros automáticos en las principales plazas y ciudades del país para hacer trasferencias de Bitcoin y dólares en los llamados “Punto Chivo” y este martes 7 September also makes available the electronic purse "Chivo Wallet" that includes a bonus of $30.00 equivalent to Bitcóin to be used by those who download the application in order to learn how to use the new payment system.

The Bitcoin Law, that only has 16 articles, approved last June by the ruling majority in the Legislative Assembly and allies, indicates that “Todo agente económico deberá aceptar bitcoin como forma de pago cuando así le sea ofrecido por quien adquiere un bien o servicio”.

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The opposition indicates that the use is mandatory, although President Nayib Bukele has indicated that it will be left to the option of the Salvadorans.

The Salvadoran president has promoted the use of bitcoin as a measure to eliminate the payment of commissions for sending remittances from abroad, mainly from the United States, that sustain the Salvadoran economy where almost half a million households receive family remittances and benefit 1,63 million Salvadorans.

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According to government authorities, son 400 millions that Salvadorans pay abroad each year to send remittances, what in 2020 added more than $5.900 millions.

Greater financial inclusion, less bank intermediation, A bet on the future of cryptocurrency and another practical option in transactions are some of the advantages that the government points out in the implementation of Bitcóin as legal tender, making El Salvador the first country in the world to legalize this financial ecosystem.

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But nevertheless, most salvadorans show disinterest, rechazo y desconfianza al uso del bitcoin, according to survey results.

According to the recent study of the University Institute of Public Opinion of the Central American University (Iudop), the 66,7 % of the population believes that the Bitcóin Law should be repealed, the 78,3 % of citizens are little or not at all interested in downloading the electronic wallet application on their phones and 71,2 % prefer to use the dollar.

Repeatedly, opposition deputies who are a minority in parliament, They have requested to repeal the Bitcóin Law due to inconvenience to the country, but nevertheless, the requests have not been echoed in the bench of pro-government deputies.