President Nayib Bukele has promoted the cryptocurrency as a path to financial freedom, but economic experts and many Salvadorans worry the move brings great risks.
El Salvador on Tuesday became the first country to adopt Bitcoin as legal tender, allowing the cryptocurrency to be used in any transaction, from buying a cup of coffee to paying taxes.
The bold move, largely celebrated by the international bitcoin community, has found a more skeptical reception at home and in the traditional financial world, amid concerns that it could bring instability and unnecessary risk to the Central American country’s fragile economy.
Time has to tell on the decision whether it is a right decision. President Nayib Bukele is literally going all in and betting his legacy on this move.
President Nayib Bukele, a tech-savvy millennial, has promoted the digital currency’s adoption, pitching it as a way of bringing more Salvadorans, about 70 percent of whom don’t have bank accounts, into the formal economy. Using the cryptocurrency would make it faster and cheaper to get remittances from abroad, he argues, and could free the indebted nation from the hold of the traditional global financial system.