Miami, USA: El Salvador will become the world’s first country to adopt bitcoin as legal tender alongside the US dollar.
El Salvador President Nayib Bukele revealed to make bitcoin legal tender alongside the US dollar, during a bitcoin industry event held in Miami.
“Next week I will send Congress a bill that will make bitcoin a legal tender,” El Salvador President Nayib Bukele addressed Bitcoin 2021 in a video message.
El Salvador is partnering the digital wallet company Strike to build the country’s modern financial infrastructure using bitcoin technology. The company built its digital wallet on bitcoin’s Lightning Network.
Strike welcomed El Salvador’s move to adopt bitcoin as legal tender alongside the US dollar. It expects that this move will help unleash bitcoin’s power and potential for everyday use cases on an open network benefiting individuals, businesses, and public sector services.
Strike Founder and CEO Jack Mallers have been providing market insights to help make El Salvador build its modern financial infrastructure using bitcoin technology.
Mallers is one of the earliest Lightning Network developers. This technology provides more advantages over legacy financial and current payment systems.
“This is the shot heard ’round the world for Bitcoin. What’s transformative here is that bitcoin is both the greatest reserve asset ever created and a superior monetary network. Holding bitcoin provides a way to protect developing economies from potential shocks of fiat currency inflation,” said Maller during Bitcoin 2021 event.
“Additionally, adopting a natively digital currency as legal tender provides El Salvador the most secure, efficient and globally integrated open payments network in the world,” added Maller.
Making bitcoin legal tender can help countries like El Salvador shift from a cash dominated economy to a transparent digital economy, where the mobile will become a bank account. About 70% of the population of the central American nation do not have bank accounts or credit cards.
In addition, remittances account for more than 20% of El Salvador’s GDP. For international transfers, incumbent services can charge 10% or more in fees that take days to arrive and must be collected from a physical location.
It has assembled bitcoin leaders across the world to help build a new financial ecosystem with bitcoin as the base layer.
“It was an inevitability, but here already: the first country on track to make bitcoin legal tender. Another milestone for bitcoin and El Salvador. We’re pleased to help El Salvador on its journey towards adoption of the Bitcoin Standard,” stated Adam Back, CEO – Blockstream.
Back plans to contribute technologies like Liquid and satellite infrastructure to the Central American nation.