El Salvador, the first country to adopt Bitcoin as its legal currency, is receiving praise as well as criticism from all over the world. The finance minister Alejandro Zelaya recently defended the country’s strategy that has been recently challenged by many in the crypto space amid the crypto winter season.
During a recent interview with Bloomberg, Alejandro Zelaya said the digital currency has given financial services to a population that is mostly unbanked, attracted tourists, and drawn investments. He said he continues to trust in digital money even though its use as a medium of trade is minimal and added that the government is still preparing to issue a Bitcoin-backed bond using blockchain technology. El Salvador’s finance minister stated:
“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.”
El Salvador witnesses heavy criticism
During a time when the whole crypto market is facing a serious downturn, the El Salvadoran government has witnessed heavy criticism for its decision to adopt BTC as a legal tender. El Salvador has purchased 2,381 Bitcoin units with public funds, which at the current market price, is down by 50% from what the authorities paid to buy them.
Moreover, El Salvador has also delayed the issuance of the much-awaited Bitcoin bonds due to BTC’s “troubled” price, as TheCoinRise reported in June 2021. Interestingly, these bonds will lead to the construction of Bitcoin city with zero carbon emissions.
The country has been pushed by the IMF to strip Bitcoin of its legal standing. The government and IMF are discussing an extended financial facility worth $1.3 billion, but no agreement has been reached as of yet. Zelaya expressed optimism by stating, “we aren’t going to have results overnight.”
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,” he added.