El Salvador’s Bitcoin Usage Will Rise After One Month, But Headaches Continue

Texas News Today

FILE PHOTO: Woman for sale with a sign saying “Bitcoin was accepted here” outside a store in San Salvador, El Salvador, where cryptocurrencies are accepted as a payment method, on September 24, 2021. Reuters / Jose Cabezasi

October 7, 2021

Wilfred Pineda and Nelson Renteria

El Salvador, El Salvador (Reuters) – More and more El Salvadorans are experimenting with bitcoin since the country first adopted bitcoin as a fiat currency last month, with hundreds of immigrants using the cryptocurrency every day. I’m sending $10,000.

But only a small fraction of the Central American country’s business is paying for bitcoin, and technical problems plagued by government crypto apps have vexed even tech enthusiasts. ..

Adalberto Galvez, a 32-year-old construction worker, said he lost $220 when he tried to withdraw cash from his Chivo digital wallet.

Dozens of Salvadorans like Galvez told Reuters there was at least one problem with chibo, which is named after the local word for “good” and used by some on a daily basis. Rice field.

“It cost me money, but I got nothing,” said Bitcoin Months in another application on an experimental small-scale bitcoin economic project called Bitcoin Beach in the coastal city of El Zonte. Galvais, who was using it well, said.

Galvez said the money was taken from his Bitcoin Beach wallet, but he could not withdraw the cash through Chibo. He said that even after registering the complaint, he did not get any reply.

Others have also reported irregularities in transactions and theft of identity attempts. President Nayib Bukele has blamed the high demand for the problems facing Galvez and others.

Spokesmen for Cheong Wa Dae and Chibo were not asked to comment.

Recruitment by some measure was faster in poorer countries where one-fifth of households depended on remittances.

According to Bukele, Chivo has been downloaded by 3 million people, about 500,000 more than originally targeted, which is roughly half of the country’s population. In September, he said the wallet had 2.1 million active users.

The El Salvador Foundation for Economic and Social Development reported that a month after its launch, 12% of consumers used cryptocurrencies.

“Since yesterday, Salvadorans have poured in more cash (to buy #bitcoin) than they could withdraw from @chivowallet ATMs,” Bukele tweeted on Wednesday. “It’s so surprising at the beginning of the game.”

However, the foundation, which surveyed 233 companies across various sectors, found that overall usage remained low and 93% of companies did not report bitcoin payments.

“We still don’t know what the government expects,” said Leonor Selva of the National Private Business Association, one of several business groups that doubt the deployment.

non-resident money

The Bukele government wants the 2.5 million Salvadorians living in the United States to eventually send money through Chivo.

So far 30 bitcoin ATMs have been set up in Atlanta, Chicago, Houston and Los Angeles to send remittances, and Bukere says about $2 million are sent daily through Chivo.

Juan Moz, a construction worker who has lived in the United States since 2005, recently decided to send Chivo to his family. Their decision saves up to $18 compared to traditional money transfer services.

“I will definitely continue to use it,” he said in a telephone interview from San Francisco.

However, most of El Salvador’s annual remittances of $6 billion (about a quarter of GDP) are still due to remittances, and many are wary of cryptocurrency volatility.

El Salvador bought 700 bitcoins last month. Prices initially fell after adoption on 7 September, but rose towards the end of September, reaching around $54,000 per coin this week.

Some told Reuters that they downloaded their wallet and received the $30 bonus the government offered at the start of the program.

The handout was big enough to benefit owners of small businesses like Alexander Diaz, whose business grew into restaurants offering chicken wings.

“Most people who had that bonus wanted to test how it was used, so some customers paid us with bitcoin,” Diaz said. About 20% of our customers are currently using cryptocurrencies.

“Chivo benefits small entrepreneurs because it makes payments easier for their customers,” Diaz says.

(Reporting by Wilfredo Pineda and Nelson Renteria, Written by Stephanie Eschenbacher, Edited by Chizu Nomiyama)

El Salvador’s Bitcoin Usage Will Rise After One Month, But Headaches Continue

Source Link After One Month, El Salvador’s Bitcoin Usage Will Rise, But Headaches Continue

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