El Salvador, a country in Central America, made Bitcoin a legal form of payment almost a year ago. El Salvador’s finance minister, Alejandro Zelaya, said on Thursday, July 28, that the country’s bet on Bitcoin has been going well enough.
He noted that Bitcoin enabled them to provide financial services to a primarily unbanked community while simultaneously inviting tourists and investors. He cautioned that Bitcoin’s use as a medium of exchange remains minimal. On the other hand, he stated that the government of El Salvador remains committed to issuing a Bitcoin-backed bond using blockchain technology. During a Wednesday interview with Bloomberg, Zelaya said:
The phenomenon is pretty new to many people, but it is gaining traction and will continue to do so for the foreseeable future.
El Salvador has purchased 2,381 Bitcoins with public funds over the last year. In contrast, they have been losing 50% of their average sales price.
According to a recent survey by the National Bureau of Economic Research (NBER), many people still prefer to pay with cash rather than Bitcoin. On the other hand, Zelaya is a strong believer in the potential of digital tokens. He stated:
Results will not appear immediately, and we cannot go to bed with little and awaken with a million dollars. Since the advent of new technologies, it has become clear that although individuals once shrank from things like websites and digital commerce, the reality now forces itself.
According to Zelaya, El Salvador’s government intends to issue $1 billion in Bitcoin bonds, but they will not do so until the market is in a better place. The El Salvadorian government is striving to advance its “Bitcoin City” idea and will begin implementing specific Bitcoin initiatives soon.
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