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El Salvador’s President Nayib Bukele said wages and pensions would continue to be paid in US dollars, without specifying whether this included salaries paid to state employees and private sector employees.
- Reuters
- Last Update:June 25, 2021, 11:44 am IS
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El Salvador President Nayib Bukele said in a national address on Thursday that the recently passed law bitcoin legal tender will take effect on September 7, noting that its use will be optional. El Salvador’s Congress has already approved Bukele’s proposal to adopt cryptocurrency, making El Salvador the first country in the world to adopt bitcoin as legal tender.
“The use of bitcoin will be optional, no one will receive bitcoin if they don’t want it… if someone receives payment in bitcoin they can choose to receive it in dollars automatically,” Bukele said. Wages and pensions will continue to be paid in US dollars, Bukele said, without specifying whether this includes wages paid to state employees and private sector employees. Earlier in the day Athena Bitcoin said it plans to invest more than $1 million to set up some 1,500 cryptocurrency ATMs in El Salvador, particularly where residents receive remittances from abroad.
According to Athena Bitcoin’s website, ATMs can be used to buy bitcoins or sell them for cash. “One of the reasons the bitcoin law is passed is to help those who send remittances,” Bukele said, adding that the high cost of commission traditionally associated with sending money would be eliminated by using cryptocurrency. El Salvador relies heavily on money remitted back from workers overseas. World Bank data shows that remittances into the country accounted for nearly $6 billion or one-fifth of gross domestic product (GDP) in 2019, one of the world’s highest proportions. Less than 1 percent of global volumes currently account for cross-border remittances in cryptocurrency, according to US payments and fintech analyst Kenneth Suchowski at Autonomous Research. But in the future crypto is expected to account for a substantial slice of more than $500 billion in global annual remittances.
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