El Salvador was the first country to make Bitcoin a legal tender, and it has worked out well for them thus far.
When Bitcoin took a dip, El Salvador announced it would be purchasing more Bitcoin, and from those Bitcoin, it also made a profit. The country’s Bitcoin Trust has now grown large enough that they will be using it to build better-surrounding communities.
President Nayib Bukele has announced that 20 new schools will be built and funded with the profits made from the Bitcoin investment.
A few weeks ago it was said that a veterinarian school would also be built with the Bitcoin Trust. Bukele declared that no taxes will be issued for these investments into the community.
Huge wins for the development of El Salvador are the exact news crypto enthusiasts want to hear. Adoption in the country is going extremely well as now more citizens have a Bitcoin wallet than a bank account.
On average the people who created Bitcoin wallets now have a 30% increase in their purchasing power.
The volatility of Bitcoin still remains to be a concern for many in the country, recent images from El Salvador showed citizens lining up at Bitcoin ATMs to turn their Bitcoin into fiat, as many believed the price of Bitcoin was high and would not remain that way.
There are many other countries that have considered adopting Bitcoin as a legal tender, this includes Brazil. Crypto enthusiasts believe that every country will eventually adopt crypto assets but there is still a long way to go with regulations before that can happen.
Other countries have begun to look and adopt Central Bank Digital Currencies or CBDCs. These would not utilize Bitcoin but would add blockchain technology to financial institutions.
CBDCs can still be beneficial to crypto enthusiasts as they can be adopted by public blockchains and increase the utility and demand of their native coins.
If the cryptocurrency market goes into another bear market, it will be interesting to see the effect it has on El Salvador and any other country that may adopt Bitcoin.
Large drops in value for legal tender can have massive implications for a country’s economy. It might be safe for now, many large institutional funds believe there will be more growth of Bitcoin before the market changes. Only time will tell.