El Salvador President Nayib Bukele announced that he will send a bill defining Bitcoin as a legal currency to Congress next week. With the law passed by Congress, El Salvador will be the first country to recognize Bitcoin as an official currency. Currently, the country uses the US dollar as its currency.
With the said law, there will be no obstacles to trading with crypto money in the country. The US dollar is currently used as currency in El Salvador. With the passing of the law, Bitcoin will begin to be used in daily transactions along with the dollar.
In his message, Bukele stated that this decision will increase employment and financial access in the country in the short term. NayibBukele also talked about the medium-term benefits of the decision. Bukele shared the video of this announcement on his social media accounts with the message 'Welcome to the future'.
Pointing out that Bitcoin has a market value of 680 billion dollars, Nayib Bukele said, “If 1 percent of this is invested in El Salvador, our economy will grow by 25 percent. In addition, Bitcoin will potentially reach 10 million new users. It will be the fastest growing method for remittance of $6 billion annually (from abroad). A large part of this $6 billion is currently going to intermediaries,” he said.
Bukele thinks that if El Salvadorans living abroad send money to their country with Bitcoin, more than 1 million low-income families will receive more money.
In addition, pointing out that 70 percent of El Salvador's population does not have a bank account and works in the informal economy, Bukele said, "Increasing financial access is not only a moral imperative, but also a method of growing the economy."
El Salvador, a Central American country with a population of 6.5 million, has an economy of 27 billion dollars. Therefore, the decision is not expected to have an immediate impact on cryptocurrency prices.
Many countries in the world have the opportunity to shop with Bitcoin. However, regulators in almost every country continue to work to put cryptocurrencies in a legal framework.