President Nayib Bukele’s administration has installed 200 Bitcoin ATMs around the country that can be used to exchange the cryptocurrency for U.S. dollars.
Bitcoin is undergoing the biggest test in its 12-year history as El Salvador becomes the first country to adopt it as legal tender Tuesday. Both enthusiasts and detractors of crytocurrencies will be monitoring the experiment to see if a significant number of people want to transact with Bitcoin when it circulates alongside the U.S. dollar, and whether it brings any benefits to the violent, impoverished Central American nation. The country bought 400 bitcoins ahead of the roll-out, with a market value of about $20 million at current prices. The country plans to buy “a lot more” of them, President Nayib Bukele said via Twitter, after buying the first batch of 200. If the experiment is a success, other countries may follow El Salvador’s lead. Its adoption will get an initial boost from the government’s Bitcoin wallet Chivo, which comes pre-loaded with $30 worth of the currency for users who register with a Salvadoran national ID number. Businesses will be required to accept Bitcoin in exchange for goods and services and the government will accept it for tax payments. The plan is the brainchild of El Salvador’s 40-year old president, who says it will draw more people into the financial system and make it cheaper to send remittances. “This is brave new world stuff,” said Garrick Hileman, head of research for the Miami-based Blockchain.
