Pencil September 7 in your diary — that's when Bitcoin will become legal tender in El Salvador.
New details about El Salvador’s plans to embrace Bitcoin have emerged — with the president confirming that every adult will be eligible to receive $30 of the cryptocurrency as a reward for downloading the government’s official electronic wallet.
Confirming that Bitcoin will become legal tender on September 7 — and shrugging off a purported court fight surrounding his controversial law — Nayib Bukele unveiled “Chivo,” an app that will facilitate instantaneous conversions from Bitcoin to dollars.
With polls suggesting that consumers and businesses are concerned by how quickly this law is being rolled out, Bukele stressed:
“The government is going to see to it that this works.”
The president sought to assuage fears surrounding the imminent plans to adopt Bitcoin — and insisted that the new app is secure and its use is optional.
Bukele also revealed that the Chivo app will pave the way for Salvadorans working abroad to send funds home to their loved ones immediately — without having to spend a minimum amount or go through an intermediary.
Elsewhere, the president said that pensions and salaries are going to continue to be paid in dollars — and he rejected claims that Bitcoin is designed to replace the fiat currency as “a falsehood and an absurdity.”
The remarks appear to pour cold water on suggestions that Bukele was getting cold feet over the radical plans.
Nonetheless, concerns remain over how Bitcoin will be implemented into the economy in such a fast timeframe.
Speaking to CoinMarketRecap, a new podcast from CoinMarketCap, assistant professor of law Rohan Grey said:
“I think Bitcoin has got a lot of problems as both a currency and settlement payments system.”
He also questioned whether BTC is practical to be used for remittances — irrespective of how expensive current solutions are.
“Right now, the costs of sending transactions on the actual Bitcoin network … we’re talking tens of dollars a transaction, it’s not viable for people who are having monthly income in the low hundreds of U.S. dollars.”