El Salvador accepts Bitcoin as Payment System.
Most of you may have never heard about the country El Salvador but they created history in the Bitcoin Conference 2021 when the President Nayib Bukele announced that it will accept Bitcoin as a legal tender for its payment system. Most people considered this as a unique and a bold step taken by a small developing nation but how will it work and will this benefit the country in the long run?
How it will work?
Bitcoin offers an amazing system that fits El Salvador’s requirements. With 70% of its population not having a bank account and also more than 1.5 million Salvadorians living abroad, Bitcoin offers an easy solution for these Salvadorians as remittances can be done easily and much more cheaply through Bitcoin wallets.
President Nayib Bukele announced that he would propose the move to the congress this week and will be partnering up with mobile platform Strike to help with the rollout for the Salvadorians.
It will be used as a legal tender alongside its national currency which is the US Dollar. Although a lot of financial infrastructure has to be set up for a nationwide adoption of cryptocurrency, but these will be a real world test that will further cement Bitcoin in the global financial landscape.
Why do they accept Bitcoins?
Although a lot of countries are going for their own digital currencies, El Salvador chose to follow the original blueprint of Bitcoin. For a small country like El Salvador, the mainstream adoption of Bitcoin could prove to be hugely beneficial in attracting foreign investments to the country.
El Salvador could be the hub that will tempt the ultra rich to invest their money with the President stating that there will be no capital gains tax for Bitcoin.
It is also beneficial with the remittances that can be transferred easily and cheaply, it means there will be more money coming into the country also from its citizens living abroad which, in turn, raises the standard of living for the people.
Also with the President Nayib Bukele stating that he will give permanent residence to Crypto entrepreneurs, El Salvador could be the Silicon Valley for Cryptocurrency startups that will in the end provide more jobs and opportunities for its citizens.
How will this benefit the country in the long run?
Of course you can say Bitcoins have issues with volatility that could also plunge this country’s assets but if you can find a nationwide demand for it and also regulate it with the government’s backing, you may find yourself making an investment in which the value drivers are more than 10 million people in your country.
Of course this could be a risky gamble for El Salvador but looking at all the opportunities and benefits that could be gained, it could be a massive boost for a developing nation like El Salvador. We hope that with this, it could lend a massive boost to worldwide adoption of decentralized currency.
We in Nagaya technologies believe that the digital currency has a huge potential to grow and definitely the more mainstream adoption could help with its volatility issues. That is why we decided to create the world’s first hybrid cryptocurrency that is backed up with Gold to help give it stability and running subsidiary projects to help increase its value.
Interested to know more about Nagaya Technologies, you can find out more at www.nagaya.io
Or you can talk to us at t.me/nagayaofficial
