Residents of ‘Bitcoin Beach’ in El Salvador happy about rise in value of cryptocurrency

In El Zonte, El Salvador, known as “Bitcoin Beach,” Maria Aguirre, a shopkeeper, experienced joy as the value of her bitcoin investment surged. Purchased for $2,200 four years ago, her holdings are now valued at around $19,000. Bitcoin, legal tender in El Salvador since 2021, has provided Aguirre with economic stability, allowing her to make significant purchases like a washing machine and a refrigerator. Other businesses in El Zonte also accept bitcoin alongside the US dollar, which replaced the national currency in 2001.

President Nayib Bukele spearheaded the adoption of bitcoin as legal tender in El Salvador, aiming to bolster the economy reliant on remittances. Despite Bukele’s enthusiasm, only one percent of the over $8 billion remittances in 2023 were received through digital wallets. While some, like Blanca Castillo, have benefited financially from bitcoin, concerns persist regarding its volatility.

Rosalina Franco, another local business owner, accepts bitcoin but opts to save rather than spend it due to the challenges of conducting transactions via phone. Despite the enthusiasm in Bitcoin Beach, a survey revealed that 88 percent of Salvadorans did not use bitcoin in 2023, primarily due to distrust in its volatility. Critics warn of the risks associated with such a volatile currency, even as proponents see it as a means to reduce financial barriers and transaction costs.

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