In El Zonte you live in bitcoin

The Buenos Aires Times wrote an interesting article on the new law passed by the El Salvador parliament that allows bitcoin to be used as fiat currency for all kinds of transactions, alongside the US dollar. In a voluntary but decidedly solicited way, according to the latest statements by President Bukele. Experts and regulators have made no secret of the problems related to the volatility of the cryptocurrency and the lack of protections for its users. Nayib Bukele touted the move, which will go into effect in September, as a way to prevent losses of “millions of dollars” in transaction fees for remittances from abroad, traditionally sent in dollars through agencies such as Western Union. The country, with its 6.4 million people, is heavily dependent on remittances from its 1.5 million expatriates: transfers represent almost a quarter of its GDP. According to data from the World Bank, El Salvador received more than $ 5.9 billion in 2020 from citizens living abroad, mainly in the United States. El Salvador is betting on an increase in remittances, which fell by 4.8 percent last year, to revive its struggling economy mainly due to the coronavirus epidemic. Edward Moya, a market analyst at the Oanda brokerage firm said, “In May, bitcoin transfers to El Salvador quadrupled and could rise if prices continue to rise.” Last week, the IMF reported the his concerns, with spokesman Gerry Rice telling reporters that El Salvador’s move “raises a number of macroeconomic, financial and legal issues that require careful analysis.” While a survey by the country’s Chamber of Commerce and Industry, released last week, found that 96.4 percent of the business community would prefer bitcoin to remain optional, 93.2 percent of employees would prefer to receive their salaries in dollars. and 82.5% would continue to use the greenback for remittances.In short, El Salvador is likely to continue to use traditional methods for remittances until bitcoin becomes a stable asset. Meanwhile, bitcoin has already brought a revolution to a city in El Salvador, El Zonte on the Pacific coast, where hundreds of businesses and people now use the currency for everything from paying bills to buying a can of soda. El Zonte has no banks and only an ATM in a hotel that only guests have access to. Started as a project by an anonymous bitcoin donor, the city now boasts El Salvador’s only bitcoin ATM where people deposit US dollars in cash into a personal bitcoin wallet, then use their smartphone to spend it.

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