El Salvador’s finance minister defended the country’s strategy to adopt Bitcoin as legal tender even as critics urge the nation to ditch the experiment as the cryptocurrency world suffers through a bear market.
Almost a year into the country’s bet on Bitcoin, Alejandro Zelaya said the digital currency has brought financial services to a largely unbanked population and attracted tourism and investments. While its use as a means of exchange is low, he said he remains a believer in digital money and added the government is still planning to issue a Bitcoin-backed bond using blockchain technology.
“For some, it’s something new and something they don’t entirely understand, but it’s a phenomenon that exists and is gaining ground and will continue to be around in the coming years” Zelaya said in an interview on Wednesday.
The government has purchased 2,381 Bitcoin with public funds, which, today, are worth about 50% less than what authorities paid for them, according to calculations by Bloomberg based on tweets by President
Still, Zelaya said he sees a future where digital tokens play a bigger part.
“We aren’t going to have results overnight. We can’t go to bed poor and wake up millionaires.” Zelaya said. “New technologies have shown how people in previous years were afraid of things like websites and digital business, but it’s been shown through time that reality imposes itself.”
Bitcoin’s price dive has delayed the administration’s plans to
“I believe in the traditional, international monetary system just as I believe that new technologies are going to help human beings in the future,” Zelaya said. “So, I think making that transition is vital and it would be wrong of us to not pursue financial innovation that could benefit El Salvador.”
--With assistance from
To contact the reporter on this story:
To contact the editors responsible for this story:
© 2022 Bloomberg L.P. All rights reserved. Used with permission.