Agence France-Presse reports that “two years ago, El Salvador ignored a chorus of warnings and adopted Bitcoin as legal tender in a bid to revitalize its economy and improve access to financial services. .
“It did not work… Economist Cesar Villalona told AFP that Bitcoin “does not exist in a meaningful way in the local economy”, because in El Salvador “everything” is paid in dollars: salaries, services and goods.”
Bitcoin has lost more than half of its value since then and although President Nayib Bukele is widely popular for his crackdown on criminal gangs, his bet on the currency hasn’t waned as well… (T)two years after El Salvador became the first country in the world to adopt Bitcoin as a currency, alongside the US dollar, “the goals that were pursued…have not been achieved, people are using it to barely, they don’t have much confidence in crypto,” economist and former Reserve Bank Governor Carlos Acevedo told AFP. “The experiment didn’t work, it’s a crypto winter,” he said.
There are no figures available on how many Salvadorans have adopted Bitcoin. But a May poll by Central American University found that 71% of respondents believed that cryptocurrency “has in no way helped improve their family’s economic situation.”
In the streets of San Salvador, the verdict is severe. “I don’t think this money is working, it’s just propaganda. Where’s the profit? There’s no profit. It’s a bad investment,” Juan Antonio Salgado, 65, told AFP. years old, newspaper seller. “It’s theft,” he added, referring to currency volatility.
Even a video report from Al Jazeera opens by asking “So was the experiment successful? The overall verdict – not yet, at least.”
They report that even though a fifth of El Salvador’s GDP comes from remittances, less than 2% of its remittances have been made through cryptocurrencies and digital wallets so far this year. Construction has not yet started.”Bitcoin City— and the country has yet to issue the “Volcano Bonds” that would finance its creation.
And during that time, government bitcoin purchases lost about $45.4 million.
