In today’s article, we are going to discuss the topic, “Will Bitcoin Be El Salvador’s Passport to Riches?” This Golden Visa plan has been designed to attract crypto investors, but whether it’s a boon for financial inclusion or not. Continue reading to find the answer!
El Salvador’s populist & Social Media Savvy President, Nayib Bukele has bemused the details of the bitcoin investors twitter profiles through Ruby Red Laser Eyes. This decision was taken by him to hitch the country’s wagon to the cryptocurrency and it has earned a cheering welcome among the investors market.
After the action of Nayib, the cryptocurrency is now legal tender in El Salvador. It means merchants have to accept cryptocurrencies as payment. Also, a geothermal mining project and a golden visa program for bitcoin investors have also been launched. This created a massive impact in the crypto world and till the investors are thinking how fast Nayib Bukele was able to roll out this.
Many of the investors are saying that the action of Nayib is making a great impact in the crypto market. Anyhow, it is too early to judge where Bukele’s crypto experiment will go! On the other side, the risk of worsening the regulatory oversight and governance in El Salvador is real as highlighted by the International Monetary Fund. Also, Bukele’s plan has raised fears that it may turn down his request for a $1.3 billion loan.
For all his experiment of monetary addition for impoverished Salvadorans and his knowledge of pick-up in remittances on which the country depends on 20% of GDP, the courting of Bitcoiners as a source of investment feels like a “Move fast and break things” moment — in a worsening way.
The social media charm, Nayib Bukele promised no real estate tax, no capital gains tax, and permanent residency to anyone with three bitcoins approximately $120,000 at market price. As per the current market terms, there are nearly 360,000 addresses holding more than $100,000 in bitcoin.
Will Bitcoin Be El Salvador’s Passport to Riches?
The same kind of investment ideas rolled out earlier in 2007-2008 after the financial crisis. This method has brought bitcoin available to the public and this way the demand for bitcoin has been increased.
For a country like El Salvador, which historically had an evident struggle with crime, poverty, and corruption; this setup of cryptocurrency looks like a dangerous thing. Further Bukele accused of backsliding and without proper guidance, illicit money flows are likely to proper. But when considering El Salvadorans financial situation; Bitcoinization won’t be a cure for the one in four Salvadorans who make less than $5.50 a day. Dollar remittances will likely continue to dwarf Bitcoin equivalents for a long time.
El Salvador has been here before. Marketers say that nearly 20 years ago; it adopted the US dollar as a path of future prosperity, but they didn’t gain the results they expected. Given the role played by non-currency issues such as corruption and governance; it’s possible that Cryptocurrency & Bitcoinization could also go the same way.
But if the marketers invest their money wisely with prior knowledge; then for sure El Salvadorans can enjoy many good benefits by investing in crypto coins.
Stay tuned with us to know more about Cryptocurrency and its market trends!