![]() The benefits of the Bitcoin Law in El Salvador Now that there's a cheap-but-annoying method of doing remittances using crypto, the banks have had to cut rates to the point where their slightly better user experience is worth the priceīut clearly, President Bukele, who often floods social media with messages praising Bitcoin and the merits of the choice made by El Salvador, does not think so. The same thing may be going on in El Salvador. There are many experts who say El Salvador’s experiment can be defined as a real failure, as suggested by BitTorrent founder Bram Cohen a month ago: In any case, according to some calculations, so far the country would be at a loss across all 10 purchases of digital currency made throughout this year since the Bitcoin Law was passed.Īccording to some analysts, Bitcoin below $30,000 could eventually even result in a default risk for the country. The approximately $20 million purchased in the first two months would have been practically halved. The sharply negative cryptocurrency market in these last five months of 2022 has certainly had a negative impact on a country like El Salvador, which is already heavily indebted, with a high inflation rate and widespread poverty among the population.Ĭertainly, the fact that the value of Bitcoin, since September 2021 (when it was about $46,000) has lost more than 50% of its value, has affected the purchases made by the country’s bank. But not all of these initiatives have been successful. On several occasions, the central bank has bought Bitcoin on the market. It launched a state loan backed by Bitcoin. ![]() Or that of using geothermal energy from the dozens of volcanoes in the country to power cryptocurrency mining. In the end, Bukele resisted and began launching initiatives related to Bitcoin development, such as making the world’s first city entirely dedicated to the digital currency.
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