In a recent interview with Bloomberg News, the Finance Minister of El Salvador Alejandro Zelaya doubled down on the country’s bitcoin bet.
In September last year the government of El Salvador made bitcoin legal tender.
The country immediately popped on the radar of mainstream financial news sites and the president, Nayib Bukele, has since become sort of a meme in the bitcoin space, who according to his own accounts “buys the dip” when he’s using the restroom.
Despite the hype in the bitcoin community about the first nation state adopting bitcoin as legal tender, El Salvador’s actions were met with criticism by mainstream financial institutions including the International Monetary Fund (IMF).
The IMF had urged El Salvador to reverse its actions and abandon bitcoin as legal tender in the country. The president shrugged at these requests. However, El Salvador’s bitcoin holdings are down over 50% from their all-time high.
Additionally to making bitcoin legal tender, the government had acquired 2,301 bitcoins for a total of $103.9 million.
The Finance Minister of El Salvador, Alejandro Zelaya, mentioned that although the bitcoin investment is down, adopting bitcoin as legal tender has had many positive benefits for the country. According to Zelaya, bitcoin is benefiting the majority of unbanked people living in El Salvador.
It is estimated that around 70% of El Salvador’s population was unbanked in 2021, with no access to traditional financial services or bank accounts. Bitcoin, although met with skepticism by some El Salvadorians due to prior government corruption and financial mismanagement, can help bridge this gap.
The Finance Minister also mentioned that the country’s adoption of bitcoin led to a wave of tourists coming to the country. This includes bitcoiners that have decided to move to El Salvador as well as interested people that want to experience first-hand what a “bitcoin standard” looks like.
