Every adult citizen in El Salvador will receive $30 worth of bitcoin when they download and register the government’s cryptocurrency app, President Nayib Bukele announced late Thursday as he unveiled details on how the nation would become the first to make bitcoin legal tender.
Alongside the typical touristy surf-town sights of El Zonte, El Salvador, are garbage barrels emblazoned with the Bitcoin “B” and signs hanging over the door in dirt-floor restaurants that announce, “Bitcoin accepted here.” For the past two years, El Zonte—aka “Bitcoin Beach”— has been experimenting with the cryptocurrency, in the hopes of creating an economy that runs at least partially on Bitcoin. Now, the Salvadoran government wants to try this nationally. El Zonte’s Bitcoin journey began in 2019, when ex-pat Michael Peterson received a proposition: A mysterious donor had a cache of Bitcoin—but instead of cashing out, he wanted to use it to create a Bitcoin circular economy. Though Peterson was thrilled by the challenging concept, it wasn’t until the pandemic hit and the town’s tourist economy crashed that others began to get on board. The project began by simply giving away $35-$50 worth of Bitcoin a month to 500 families in El Zonte. Soon enough, local businesses began to accept the cryptocurrency. Now, about 90 percent of households in the town interact with Bitcoin on a regular basis. These transactions are bolstered by an app, Strike, that makes it possible to send cheap international Bitcoin transfers—crucial for a country like El Salvador, which receives close to $6 billion a year in remittances from Salvadorans living in the U.S.
