People & Money

Bitcoin is paving the way for El Salvador to be a real economic powerhouse

Greetings from El Salvador! Well, nearly. I’m actually back in the UK now after a lightning (pun intended) visit to this amazing country as a guest of the El Salvadoran government with the Bitcoin Racing Team last week.

Also Read: $68,000 Bitcoin and other Firsts: Cryptocurrency in 2021

I’ll openly admit I enjoyed the red carpet treatment as we explored ways to work together, visited a volcano-powered Bitcoin mining plant and got to experience, first hand, the culture of a country that until recently, had the dubious mantle of being the most dangerous nation in Latin America.

But not anymore.

On our last day, the President Nayib Bukele tweeted a confirmation that in September 2022, the country experienced exactly zero homicides for the first time in its history. For context, the UK averages around 50 a month, the US around 2,000 (2021 data). This is all to do with Bukele’s relentless crack down on the ultra-violent gangs that had run the country for the last two decades.

Their reign is well and truly over and, as a result, the optimism that oozes from the very souls of these people is utterly inspiring and extremely infectious. For the first time in years they are free to build businesses without being extorted or even just to walk the streets safely. To cap it all, they are building an economy entirely independent of anyone else by building on Bitcoin.

Even as a committed HODLer, I still contributed to the circular economy by paying for as much as I could with Bitcoin over the Lightning Network, which, coincidentally, reached a new capacity milestone of 5000 Bitcoin this week. I paid for sushi, taxis, McDonald’s coffees and even protein shakes on El Zonte beach, but it’s true that acceptance outside the capital is low and some people still view it with scepticism. That said, have no doubt that El Salvador is on the right track. It really is.

Also Read: Crypto markets lifted by strong US jobs report with Bitcoin, Ethereum and Cardano up five per cent

As for the rest of the world, not so much. In the old days, we smug westerners in our “safe” and “developed” economies might have looked down on these little guys and laughed at their puny efforts, but it feels like now the tables are turning. As the rest of the world crumbles, El Salvador is quietly positioning itself to be one of the next powerhouses of the world, thanks, in part, to Bitcoin.

Here in the UK, as Liz Truss takes a gigantic chance with our finances, the fallout is likely to be spectacular. Perhaps there was little choice as this is a genuine no-win scenario, but the loss of the value of the pound on international markets and the extreme increases in interest rates lay bare the weakness in our current – and flawed – fiat system. Make no mistake, very rough times are ahead.

Meanwhile, what Ukraine is achieving against the Russian occupiers of its land is nothing less than spectacular. Russia is now the biggest supplier of arms to Ukraine and Putin’s forces are in total disarray. It’s very unlikely his recent mobilisation is going to change anything soon in terms of the front, but it IS quite likely that his actions will do what global sanctions have only partially done so far, completely finishing off the Russian economy for the foreseeable future. Madness.

Also Read: Political Heat Rises as El Rufai Hosts Northern Governors

However, Putin did achieve one small victory in this, his 70th birthday week, by getting an agreement with Mohammed Bin Salman of Saudi Arabia to cut oil production by two million barrels a day, thereby driving up oil prices further and helping him fund his war. This is an entirely irresponsible thing to do from a moral standpoint, but, as ever, money talks. Sometimes I despair for the human race, I really do.Thank goodness for Bitcoin. Thank goodness for countries like El Salvador who may, genuinely, end up showing us the way forward from here. Who would have thought that possible, even just a few short years ago?

This article was culled from

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