With its president making it the first country to recognize bitcoin as a currency Legal currency, inviting miners to They set up shop among the volcanoesCurrently, El Salvador is at the epicenter of the Bitcoin world. And while these developments are relatively new, the adoption of BTC was clearly underway in the country’s daily use of bitcoin as a financial bar.
“Monthly bitcoin transfers of less than $1,000 — a proxy for money sent into the country from Salvadorans working abroad — totaled $1.7 million in May compared to $424,000 a year earlier,” according to data from blockchain analysis firm Chainalysis, shared exclusively with Reuters. “These transfers peaked at $2.5 million in March, although unavailable compared to the previous year.”
projects like Bitcoin Beach, a circular Bitcoin economy created in the country’s El Zonte community, has already shown how people in El Salvador can benefit from using Bitcoin for their daily purchases. And the latest moves from its president this month will undoubtedly increase the use of bitcoin nationwide. But this growing trend in smaller bitcoin remittances shows that Salvadorans are finding bitcoin a crucial tool for international remittances, on which they rely heavily.
“El Salvador relies heavily on remittances,” in Reuters. “In 2019, remittances using traditional money totaled nearly $6 billion — about a fifth of GDP — one of the highest in the world.”
If the necessary technical infrastructure is created to facilitate bitcoin transactions, BTC can be an incredibly efficient way to send and receive remittances. It’s free from third parties and regulators who can block or charge fees on these payments and with additional layers like the Lightning Network, transactions can be almost instant and incredibly cheap.