Business & Economy

Skepticism in El Salvador ahead of Bitcoin launch

San Salvador, Aug 30 (EFE).- With a week to go before Bitcoin becomes legal currency in El Salvador, some business owners visited by Efe on Monday displayed skepticism and cited a lack of public information ahead of the launch.

El Salvador will be the first country in the world to adopt Bitcoin as legal tender, and it will circulate alongside the US dollar, the official currency in the Central American country.

In a tour of commercial areas in the cities of San Salvador, Santa Tecla, Mejicanos and Antiguo Cuscatlán, it was observed that establishments do not have notices up to inform their customers whether or not they will accept Bitcoin as payment.

Some merchants even said they had doubts and did not know whether the exchange of goods and services with the cryptocurrency would work like the dollar.

The Bitcoin Law, approved by the Legislative Assembly with a large pro-government majority and which will come into effect on Sep. 7, establishes that every “economic agent must accept Bitcoin as a form of payment,” however President Nayib Bukele has indicated that its use will be optional.

Despite Bukele’s efforts on social media to promote Bitcoin and criticize the opposition, the cryptocurrency is not popular with the majority of Salvadorans, according to a university survey.

Andrea López, a seller of sports shoes and sandals for women in the center of San Salvador, told Efe that she is still analyzing if she will accept Bitcoin because “it is very complicated.”

López said that her mother, who also sells shoes, will not accept the currency and added that “no one has come to explain how it is going to work, that’s why people/sellers here (in the Center of San Salvador) may not accept it.”

Bukele recently said that the country will have a network of 200 ATMs at which Salvadorans who receive Bitcoin will be able to withdraw dollars in cash as of Sep. 7.

The government has started the construction of the ATM booths, which will be located in parks and public squares in different parts of the country.

In the popular Plaza Capitán General Gerardo Barrios, in the heart of the capital, one of the ATMs is already installed and guarded by the military and police.

The Bitcoin Law has generated mixed opinions in the country, mainly due to the lack of information on how it will be executed and the possible risks of using the cryptocurrency.

The Salvadoran Banking Association has urged the government to clarify concerns about the use of Bitcoin as legal tender and has called for public education programs.

The Central American Institute for Fiscal Studies was concerned about the accelerated approval of the law.

A survey by the Citizen Studies Center of Francisco Gavidia University indicated that 24 percent consider the decision not very good and 53.5 percent as not good, while 12.9 percent say that it is good and 6.5 percent very good.

The Bukele government has promoted the initiative as a measure to eliminate the payment of commissions in sending remittances from the United States, which support the Salvadoran economy and which amounted to more than $5.9 billion in 2020, according to data from the Central Bank. EFE


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