Bitcoin took the internet by storm in 2021 when El Salvador—the smallest country in South America—announced that it would make the cryptocurrency a legal tender.
El Salvador President Nayib Bukele shared the nation’s plan to adopt a bill that will make Bitcoin legal tender during the 2021 Bitcoin Conference in Miami.
The move, Bukele said, was to make it easier for Salvadorans living abroad to send money home to their relatives.
62 out of the 84 deputies voted in favor of Bitcoin Law on June 9, 2021, and it was then adopted by the country’s Legislative Assembly.
The government set $150 million to be used as a fund to support the approved legal measure. Officials even said they would give individuals $30 in BTC who sign up for an electronic wallet called “Chivo.”
El Salvador’s government expected great things for the cryptocurrency after it was adopted by the country, but more than a year later, things haven’t turned out as planned.
A research study conducted by the University of Central America (UCA) found that around 77% of El Salvadorans believe the adoption of Bitcoin as legal tender in their country was a massive failure.
To everybody’s surprise, 75.6% of the people revealed they haven’t used cryptocurrencies this year even though Bukele’s administration exerted great efforts in popularizing them.
A large number of the citizens, 77% to be exact, said that they believe the government should stop using public funds to accumulate BTC.
A September 2022 report from the Salvadoran Central Bank revealed that only 2% of Bitcoin remittances were used for digital currencies.
Bukele’s choice to invest in Bitcoin last year proved advantageous as the cryptocurrency ultimately reached an all-time high around $69,000 last November.
However, because cryptocurrency prices are always changing, the El Salvador government lost a lot of money when BTC’s value decreased and is now having difficulty making back that money.
As of this writing, based on Coingecko data, Bitcoin is being traded at $19,173 which is a 70% decrease from its record high.
Even though there are protests to rescind the newly implemented Bitcoin Law, Bukele is still optimistic because their plan has not been carried out yet.
The government is focusing its time and resources into realizing its goal of making the country a global crypto hub, instead of worrying about the negative reception from citizens.