With the introduction of Bitcoin as legal tender, El Salvador made history on September 7th. Now President Nayib Bukele has announced that more than three million people are now using the Chivo wallet in El Salvador.
Just three weeks after the new law came into force, Bukele had declared that 2.1 million people in El Salvador were using the Chivo wallet. There still seems to be strong growth in this area in El Salvador. As Bukele now proudly announced on Twitter, more than three million residents have now installed the Chivo wallet. With 6.4 million inhabitants (including around 800,000 children), more than half of the adult citizens now use the Chivo wallet. A large number of people should have come into contact with Bitcoin for the first time. As a bonus, the citizens of El Salvador received an amount of 30 US dollars in BTC.
El Salvador is now also dependent on the share price development. On the day it was launched, Bitcoin just barely failed at the US $ 53,000 mark. The price of the oldest and largest cryptocurrency then fell by around $ 10,000 within a few hours. El Salvador seized the opportunity to invest in Bitcoin at a reduced rate thanks to the setback. According to Bukele, the Central American country holds around 700 BTC. Since then, Bitcoin has had a positive balance – BTC is currently quoted at around $ 54,200. Just a few days ago, the Bitcoin price even briefly cracked the $ 55,000 mark.
This means that El Salvador has at least been able to make a profit with its investment in Bitcoin. At the same time, volcano mining recently started in the Central American country. Bukele also sees enormous growth potential here.
Even if the user numbers sound very promising, the numbers do not indicate whether the Bitcoin is also actively used as a means of payment or whether only the 30 dollars are accepted as a gift.
With the Chivo wallet, the residents of El Salvador benefit in principle from significantly better conditions for cross-border transactions. While service providers such as MoneyGram or Western Union sometimes charge horrific fees for this, transactions via the Chivo wallet with BTC are free of charge.
Although President Bukele is celebrating the first successes with the introduction of Bitcoin as the official currency and the number of users is rising rapidly, it is still not clear how far bitcoin adoption has actually progressed in the country. Because the exact intensity of the use of the Chivo wallet is unclear.
Much more important will be whether there will continue to be positive reports regarding the use of Bitcoin in El Salvador in the next few weeks and months. Even before the introduction, some residents had demonstrated against BTC as legal tender. The International Monetary Fund (IMF) is also critical of the current situation.