The tiny and impoverished Central American nation became the first country in the world to adopt bitcoin as legal tender on Tuesday, allowing Salvadorans to use the cryptocurrency to buy a cup of coffee, get a haircut or even pay taxes and home loans.
From today, businesses will be obliged where possible to accept the controversial digital coins as payment, according to BBC.
Millions of people are expected to download the government’s new digital wallet app which gives away $30 (£22) in Bitcoin to every citizen.
Bitcoin fans around the world have been buying $30 worth of the digital coins as a show of support and to help boost the value of the volatile currency.
Salvadorian taxi driver Daniel Hercules, who’s 26, is excited by the move, but also worried about how stable his earnings will be.
„I’ve accepted Bitcoin for about two months since I knew this was coming. I just had someone pay me $40 in Bitcoin for a fare to the airport but it’s rare. Only around 10% of customers prefer to pay with Bitcoin.”
Daniel says the cost of converting Bitcoin into the local currency – the US dollar – is high at 10%, so he is using the money like a savings account.
He hopes to grow his wallet to around $1,000 in Bitcoin but is scared about the currency crashing.
„It is one of the things that worries me the most. Losing money from long days of work would not be OK.”
A survey by the Central American University (UCA) found that only 4.8% of the 1,281 people who took part understood what Bitcoin was and how it was used. More than 68% of those questioned said they disagreed with using cryptocurrency as a legal tender.
Meanwhile, more than 200 new cash machines are being installed across the country to enable dollars to be converted into Bitcoin.
Author, advisor and global commentator on digital financial services, David Birch, said that it is also sceptical about the move: „To my mind there is a very big difference between allowing people to use a new form of money if they want to (actually, bitcoin is not money, but that’s a different point) and forcing people to use a new kind of money on pain of imprisonment or whatever. The former is what we might associate with democracy and freedom whereas the latter is what you might associate with North Korea or France.”
Banking 4.0 – „how was the experience for you”
„So many people are coming here to Bucharest, people that I see and interact on linkedin and now I get the change to meet them in person. It was like being to the Football World Cup but this was the World Cup on linkedin in payments and open banking.”
Many more interesting quotes in the video below:
