El Salvador President Nayib Bukele says he will
make the Bitcoin cryptocurrency legal tender in the country, saying that “Bitcoin
will make it easier for Salvadorans living abroad to send payments home.”
If his plan is backed by congress, the Central
American country would be first in the world to formally adopt the digital
It would be used alongside the US dollar, El
Salvador's official currency.
"In the short term, this will generate
jobs and help provide financial inclusion to thousands outside the formal
economy and could also boost investment to the country," Bukele said.
a market cap of $680 billion dollars and if 1% of it is invested in El
Salvador, that would increase the gross domestic product (GDP).by 25%.
On the other side, #Bitcoin will
have 10 million potential new users and the fastest growing way to transfer 6
billion dollars a year in remittances.
He said he would send the legislation to
congress next week.
Should it pass, the move would open up
financial services to the 70% of Salvadorans who do not have bank accounts, the
El Salvador's economy relies heavily on
remittances, or money sent home from abroad, which make up around 20% of the country's
More than two million Salvadorans live outside
the country, but they continue to keep close ties to their place of birth,
sending back more than $4bn (£2.9bn) each year.
Current services can charge fees for such
transfers, which can take days to arrive and sometimes need to be picked up in
person, according to the announcement.
"This will improve lives and the future of
millions," Bukele said.
He did not give more details about how the
policy would work.