Report from El Salvador : « The first 40 days of BTC as our currency »

Dear fellow LeoFinancers, during the last weeks some Hivers - among whom @selfhelp4trolls - upon discovering that I live in El Salvador, have been utterly welcoming and interested to hear how life has been for us since the adoption of BTC as our second legal tenant currency. That’s why I decided to write down 3 small articles, sharing an analysis of the evolution I’ve been a witness of, and trying to intentionally discard any media fueled FUD or shill around that BTC State supported implementation.

I’m gonna focus first on the benefits I spot in this game-changing environment, for the Salvadorans and the economy as a whole, will tackle in a second article the risks and drawbacks related to how our economy’s BTCization is being implemented, and describe, in a third publication, one of the grassroots initiatives currently unfolding to promote cryptoeducation among our fellow compatriots.

A couple of observations from living in « BTC-Land »

a) « Unbanking through crypto » has become a reality

As someone who doesn’t own a bank account (or should I say : « who isn’t owned by a bank account »…), I’ve found in the current Lightning Network / « Chivo » app deployment a hint of how a day to day crypto economy can and must work.

Let’s first clarify that not owning and using a bank account in nowadays’ society, constitutes for me a basic self-preservation measure, as much on the privacy side (I wouldn’t stand a private company – nor a State - to have access to almost all my earnings & purchases data) as because of the vulnerability it’d create on my incomes fate (let’s take a look at what’s happening in Lebanon, for example, where for 2 years now the whole population has seen its savings and wages being locked down in the banks – a hell of an efficient custody!).

Well, now in many cases I don’t even have any reason to WANT to cash out my BTC – and any pressure to open a bank account : I may turn my dollar banknotes into satoshis, through one of the 205 ATMs that were implanted on our territory, and spend them in a growing array of shops and companies next door. The same applies to a part of my incomes, being paid directly to my Lightning Network wallet (better if it’s not a Strike / Chivo wallet, I’ll touch that point later).

Bitcoin ATM El Salvador – find bitcoin machine locations  coinatmradar.com.png

b) A quite consistent State’s commitment

From the day 1 of downloading and using the State sponsored "Chivo" app, my whole family has been accompanied by abundant and easily accessible « how to » info. And when speaking of « my whole family », I include people like my mother-in-law or her own mother, who had previously heard of BTC and crypto almost only through the TV and Facebook communications our President, Nayib Bukele, hold about those topics during the last 3 months.

As most of you would probably know, each Salvadoran citizen who registers on « Chivo » instantly receives the equivalent of $30 in BTC. I never thought I’d ever in my lifetime praise a State for inciting us to use a cryptocurrency, being myself an autonomous cryptos and self-custody promoter, but here in El Salvador, where someone holding a computer science degree and working as a network coordinator in a public school earns $300 per month, and most rural workers don’t reach a monthly $150 revenue, that $30 BTC “gift” has converted the Strike / Chivo app installation into a very popular move (a move that must increase our vigilance even more, though, around the next steps of such a State-stewarded nationwide “experience”).

« Chivo » itself is a private company, but there’s no doubt that the State’s hand has accelerated all kinds of procedures for them to implant 205 BTC ATMs in malls and strategic locations (our country is now the third, planetary wise, on the basis of crypto ATMs quantity, just after the US and Canada – and for sure the first one for the ATMs territorial density – 1 ATM per 102 km²). A series of « Puntos Chivo », « Chivo Points » (see picture), with employees available to explain how the app works and to allow non tech savvy people to load their account with BTC or to cash out to dollars, without recurring to a bank, have also been set up in the cities.​

Punto "Chivo".jpg

c) Sowing the seed of self-sovereignty

A lot has been written about the fact that El Salvador has adopted a cryptocurrency, and was the first nation to do so.

But almost nobody stressed something maybe more fundamental : our State is the first one, at least in contemporary history, to adopt two currencies, be them cryptos or not. When several European States have embraced the euro, back in 2002, each one of their national currencies have been kicked out of circulation, and that measure was an enforcement of the « One State / One Currency » principle, that States like the Chinese and the American ones are currently hammering all cryptos with. The coming digital reminbi (« yuan ») and digital dollar (Central Bank Digital Currencies) will tolerate no competing currencies, and seal – in my opinion – the prohibition of all autonomous cryptos in those countries.

That CBDC’s victory was poised to be undisputed… Until our tiny country reversed the tide, and demostrated that « another future is possible ». A future in which the concept of « State » might be disconnected from its traditional monopoly on minting money, and where monetary pluralism can become a whole new trend among outsider political entities and non aligned nations.

Both at an individual and collective levels, this BTC journey will have been worth the ride, at least as a self-sovereignty can opener :-)

A closing invitation :

4 months ago I created a Telegram group around this process, to share tips and data with other Salvadorans and any crypto-user willing to support the Salvadoran population in that crypto adoption for our daily purchases.

Feel free to join us, here: t.me/BTC_El_Salvador (the threads are in Spanish, but "DeepL" is a very efficient online translator ;-)).

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