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More Latin American countries voicing their support for Bitcoin - TCR

www.thecoinrepublic.com 08 June 2021 16:15, UTC
Reading time: ~3 m

  • El Salvador recently had made Bitcoin legal in the country 
  • Cryptocurrency to finally become a legal tender in El Salvador, and other countries soon
  • Latin American countries follow the El Salvador President’s belief in Bitcoin

El Salvador with few other Central American countries is working on making cryptocurrencies like Bitcoin a legal tender. After the Salvadoran President, Nayib Bukele, took a bold step towards Bitcoin, other Latin American countries followed his support for cryptocurrency adoption. If they walk the talk, soon the first-ever set of countries in the global economy will emerge who shall legalise the use of Bitcoin, making history in the cryptocurrency industry. 

El Salvador to become the first country to legalize Bitcoin

The President of El Salvador tweeted about the benefits that the country would come across after using Bitcoin as a legal form of digital money. The country’s 20% GDP is framed by the remittances sent home by citizens who stay abroad. The delay in the process of receiving these payments in the country causes a lot of interludes. 

#Bitcoin has a market cap of $680 billion dollars.

If 1% of it is invested in El Salvador, that would increase our GDP by 25%.

On the other side, #Bitcoin will have 10 million potential new users and the fastest growing way to transfer 6 billion dollars a year in remittances.

— Nayib Bukele 🇸🇻 (@nayibbukele) June 6, 2021

Moreover, the service fees, conversion rates, and other charges bring down the actual amount received by the country drastically. Nayib Bukele believes the Bitcoin transformation could be a life-changer for his country, and this decision also opens the Bitcoin market to approximately 10 million new users. 

The Salvadoran President also believes that as the Bitcoin network is precarious, having it as an authorized mode of payment shall control the currency’s volatility in the economy. Bukele, a populist millennial, plans to propose a bill to Congress in the coming week. 

Latin America hints at plans with cryptocurrency

The El Salvador leader was followed by other Latin American diplomats and politicians who raised their support towards accepting cryptocurrency. Although El Salvador may become the first country to permit the use of Bitcoin officially, countries like Brazil, Argentina, Paraguay, and Panama are right next in line. A wave of social media messages come from leaders of these countries, who have started to show interest in digital assets. 

The success of Bitcoin in developing countries, where the majority of the population does not have access to proper and systemized banking, is phenomenal. These nations have little control over their fiat money. Hence establishing a decentralized money scheme will only help their financial stances in the world. 

However, if there is such a big market opening to Bitcoin, the energy consumption problems still prevail, which might amplify in the near future. Developed countries like the United States have not recognized Bitcoin due to its high volatility and instability. The sudden surges and price drops could act against any nation rather than reforming or helping the economic stability. These factors should be considered by all such countries planning to adopt Bitcoin and other cryptocurrencies as a national payment mechanism.

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