Published in El Pais, 25 September 2021.
Recently El Salvador made history by becoming the first country to make Bitcoin legal tender. The country even gave every citizen who signed up for a wallet $30 in free bitcoin to spend at their will. Symbolically many in the crypto world purchased $30 worth of bitcoin to commemorate the event as the feeling was that many more countries will follow suit.
The president had a good reason for doing this, 70% of the country’s population does not have access to basic banking. Bitcoin, as well as blockchain in general, could easily solve that but while his motivation was in the right place, the execution was nothing short of a disaster.
When something becomes legal tender, it means you can settle debts with it. For anything else you have the right to refuse it. This means that an employer cannot pay you with in-store credit against your will. Being a crypto enthusiast myself I would gladly take your debt in Bitcoin but understandably many El Salvadorians do not share this sentiment.
Looking into the future, any country that wants to adopt Bitcoin or any other digital currency should make the move gradual. Improve the crypto infrastructure with more ATMs and have wallets more readily available. Allow incentives for stores and citizens to accept crypto as payment while giving them the legal right to still refuse it as payment