El Salvador adopts bitcoin
What will happen next in the emerging crypto world?
It’s happening. For the first time in history, El Salvador has become the first country that accepts Bitcoin as legal tender. El Salvador will now allow the use of Bitcoin in transactions for goods and structures in that country.
Besides its recent regulatory adoption, El Salvador just bought over $20.9 million worth of Bitcoin as the first step in its plan to add the cryptocurrency to its balance sheet by President Nayib Bukele. The President also purchased 15 Bitcoins for himself.
El Salvador will be using Chivo as a national crypto wallet without charging any transaction fees. In addition, all the first-time users will receive US$30 in Bitcoin right after registering a Chivo account. Chivo also supports conversion from bitcoin into US Dollar - El Salvador’s chosen national currency so that local users can select their preferred payment method at their discretion.
El Salvador has become the first country to accept Bitcoin, which has piqued the interest of the crypto world. However, cryptocurrencies are being adopted by an increasing number of businesses across a wide range of industries, from big tech to airlines.
Industries that have adopted cryptocurrency in the past.
Back in 2014, Latvian airline airBaltic became the first aviation company in the world to accept Bitcoin as payment for fares. The company has processed more than 1,000 Bitcoin transactions since it launched the payment option seven years ago.
Uniquely, during the pandemic, some of the biggest companies in the world started to accept Bitcoin for payment. For example, Coca-Cola geared over 2,000 vending machines in Australia and New Zealand that take cryptocurrency for drinks in 2020.
In the United States, the world-famous coffee shop Starbucks is also one of the businesses that try to adopt Bitcoin as payment. They allow their customers to pay for drinks and goods at the coffee chain with converted Bitcoin. They have chosen 500,000 people who took up the invitation-only as an early access program to test the digital wallet as a payment method.
Furthermore, in August, Paypal announced that users in the UK could trade in cryptocurrency on PayPal's website and mobile app. In the US, PayPal users can now buy, sell, or hold a few selected cryptos including Bitcoin, Ethereum, Bitcoin Cash, and Litecoin.
With all of these historic decisions worldwide, we can see that cryptocurrency is becoming more widely accepted as a legal payment method in various businesses across the globe.
Who is going to be the next El Salvador?
According to “The 2021 Global Crypto Adoption Index”, we can get a big picture of how the globe is now adopting cryptocurrency.
The index has three main factors to define the countries’ cryptocurrency adoption: on-chain retail value transferred, on-chain cryptocurrency value received, and peer-to-peer(P2P) exchange trade volume between June 2020 and June 2021.
The index rated 154 nations with a range of scales from 0 to 1 that determines the overall rankings. Under the list, we can see Vietnam ranked first with a 1.0 index, a full mark, followed by India, Pakistan, Ukraine, and Kenya.
However, unlike El Salvador, neither of the governments in these nations has adopted any cryptocurrency as legal tender. Nevertheless, with El Salvador's decision, can we expect to see other countries accept bitcoin? Perhaps one day, it will be a norm for everyone worldwide to transact using cryptocurrency.
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