- El Salvador’s strongman has doubled his bet on BTC despite low adoption metrics
- Bukele still has confidence in the future of Bitcoin
El Salvador’s Nayib Bukele was widely criticized when he recognized Bitcoin as legal tender across the country. Especially from companies like the International Monetary Fund and the World Bank. However, three years ago, the country now has $400 million in BTC reserves, and its decision to keep the cryptocurrency as a reserve seems like a very good idea.
This was the core of part of Bukele’s last interview with TIME. According to El Salvador’s president, while the experiment has not been a complete success, “the positives so far outweigh the negatives.”
Low adoption, but still a “net positive”
Why does the statesman think that? Well, adoption hasn’t been as high as initially expected, and Bukele underlined the same during the aforementioned interview. Still, he believes Bitcoin is a currency with a future, even if it may not be the “currency of the future.”
In fact, El Salvador’s president believes that the biggest success associated with the country’s adoption of BTC has to do with the fact that the adoption was completely voluntary. He said,
“The positive thing is that it is voluntary; we never forced anyone to adopt it. We offered it as an option, and those who chose to use it have benefited from the rise of Bitcoin.”
Despite the lower-than-expected adoption rates, Bukele believes there is “still time to make some improvements.” In fact, the country’s move to Bitcoin has been a “net positive” overall, with the same underlined by the fact that Bitcoin treasuries are now worth almost $400 million.
All other benefits
Apart from the financial benefits, El Salvador has also been on the good side of many brands, investments, tourism and attention. The expected inauguration of a “Bitcoin City” is an example of this, with many institutions, both private and state-owned, following the country’s lead and fully immersing themselves in this asset class. In many ways, El Salvador had the “First Mover” advantage over other countries doing the same with Bitcoin.
He added:
“The fact that major Wall Street firms are now doing it – something that seemed unthinkable three years ago when we were doing it – shows its impact. Some countries already have reserves in Bitcoin or are investing in Bitcoin and Bitcoin mining.”
Here the significance of what he says must be emphasized, especially since cryptocurrencies as an asset class are an important issue in the upcoming US elections. For example, former President Trump has already completed his pivot to cryptos and is even accepting them in the form of donations. On the contrary, Vice President Harris has been more cautious, something that could work against her in November.
These could be the reasons why El Salvador’s president is still doubling down on Bitcoin, with the country expected to buy more BTC for its treasury soon. In fact, its impact was so great that, despite initial doubts, the IMF released a report last year claiming that “Bitcoin’s risks in El Salvador have not been realized.”