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It’s been nearly a year since the Latin American country El Salvador made Bitcoin a legal tender in the country. On Thursday, July 28, the El Salvador finance minister Alejandro Zelaya said that their Bitcoin bet has been working fine enough for the country.
He added that Bitcoin helped them bring financial services to a largely unbanked population while simultaneously attracting tourism and investments. However, he added that Bitcoin’s use as a means of exchange still remains low. On the other hand, he said that the El Salvador government is still firm on issuing a Bitcoin-backed bond using blockchain technology. In an interview with Bloomberg on Wednesday, Zelaya said:
“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’s Bitcoin Reserves and Future Strategy
Over the last year, El Salvador has purchased 2,381 Bitcoins as part of its public funds. However, they have been sitting at a 50% loss from their average purchase price.
As per the survey by the U.S. National Bureau of Economic Research, most consumers still prefer paying in hard currency over Bitcoin. But Zelaya continues to believe that digital tokens have a bigger role to play in the future. He said:
“We aren’t going to have results overnight. We can’t go to bed poor and wake up millionaires. 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”.
Zelaya said that the El Salvador government is planning to issue $1 billion in Bitcoin bonds, however, they would bring them at a time when the market conditions improve. The El Salvador government is working to move ahead with its “Bitcoin City” plan and will launch some Bitcoin projects in the coming months.