El Salvador embraces Bitcoin

On September 7, El Salvador became the first country to recognize Bitcoin as legal tender.

El Salvador embraces Bitcoin

On September 7, El Salvador became the first country to recognize Bitcoin as legal tender. In the run-up, President Nayib Bukele said the Central American country purchased 400 bitcoins, which helped drive the cryptocurrency's price above $52,000 for the first time since May.

Millions of Salvadorians were expected to download Chivo digital wallet from Apple, Google, and Huawei's app download platforms, but ran into several hiccups as the government temporarily unplugged the service in order to connect to more servers to deal with anticipated demand. Despite the hiccups, it appears that many of the initial issues have been fixed after the maintenance period.

One business that was ready for the demand was McDonald's, who began accepting Bitcoin as payment in El Salvador the same day the country began recognizing the cryptocurrency as legal tender. The fast-food giant wasn't the only business prepared for the announcement. Independent gig workers small business owners have been accepting the cryptocurrency as payment for weeks.

While optimism surrounds El Salvador's decisions, many Salvadorians feel left in the dark as to what this means for the Central American nation long term. Even with President Bukele's incentive of depositing $30 worth of Bitcoin to everyone's wallet who downloads Chivo, many citizens don't have enough of an understanding—or access to technology—to implement Bitcoin as a form of currency. Some businesses are also concerned with how to properly document payments in both Bitcoin and the U.S. dollar, which El Salvador had to rely on as its only currency before accepting Bitcoin.

Yet, this is only the beginning of Bitcoin becoming recognized by nations. Of course there will be hiccups. Of course there will be resistance to change and progress. But overall, providing citizens with a bitcoin wallet is extremely advantageous. A borderless, virtually instantaneous, zero-fee way to exchange money in a country where 70% of the population depends on money sent home from abroad just to make ends meet? It's a definitive step towards progress for El Salvador's citizens.