WATCH AND LEARN: The Impacts of El Salvador’s Run-in with Bitcoin
Who can forget the historic news of El Salvador on the official acceptance of Bitcoin as a legal tender more than a month ago? Every crypto trader has seen a glimmer of hope in their respective countries — the world is progressively embracing cryptocurrency. With the said Bitcoin law, all companies, businesses and projects are obliged to accept Bitcoin as a payment.
Across the room, protests against the proclamation of President Nayib Bukele to transform El Salvador into a Bitcoin country took place. Thousands of locals showed their resistance in the streets by smashing one Bitcoin ATM and wearing statement shirts against the adoption of Bitcoin as a legal currency alongside the US dollar.
A month of experimentation has gone by, and crypto enthusiasts take a look at the impacts of Bitcoin as a legal tender in El Salvador.
It is still a long way to go for the world to fully accept cryptocurrencies. The news has gained a lot of different controversies and skepticism that might take time to fully vanish. Alongside is the aftermath of the first country to legalize cryptocurrency.
Bitcoin was not that popular yet in El Salvador when President Bukele approved the law. In fact, one Central American University survey showed that 68% of people did not agree with passing this certain Bitcoin project before and after the launch. Despite that, El Salvador officially began enforcing a law making Bitcoin (BTC) legal tender within the Central American country. Many traders celebrated, but most of the locals questioned the government. Why do they need to pass a law that will not benefit most of the citizens?
On day one, bitcoin fell more than 11% and more in the days that followed. There have been different opinions published on the internet. Some criticized and others were hopeful. For most long-time investors, this is not new. The short-term price dips are just normal and something to shrug off. But not with the curious investors of El Salvador.
After being legalized, the citizens tried to invest in the so-called cryptocurrency and got disappointed immediately after one or two weeks. Unfortunately, there are individuals who live hand-to-mouth and don’t necessarily have the luxury of waiting out the dips. Most of the locals in the country only earn $5.50 per day.
A country like El Salvador is not ready for that kind of modern, progressive lifestyle.
While for families who work abroad, it is an advantage to have lower remittances. A large number of Salvadorans work abroad and send money to their relatives. President Bukele said in one of his interviews that Salvadorans spend more or less $400 million in remittance fees — a huge number for just a fee. However, let us face the fact that many poor families will experience the first-hand negative impact of this law.
The Bitcoin law celebrated its first month last October 7, gaining a new set of reactions from the followers. As we progressively legalize cryptocurrencies, one question remains, does it really benefit the majority? Or just for a bunch of rich people?