Nayib Bukele, President of El Salvador, has admitted that the country’s experiment with Bitcoin as legal tender has not achieved the widespread adoption initially hoped for. In an interview with TIME Magazine, Bukele acknowledged both the successes and shortcomings of the Bitcoin initiative.
“Bitcoin hasn’t had the widespread adoption we hoped for. Many Salvadorans use it. The majority of large businesses in the country have it,” Bukele said when asked about the effectiveness of the Bitcoin Law, which was passed on September 7, 2021. This law made El Salvador the first country to accept Bitcoin as an alternative legal currency in an effort to digitize its economy and reduce dependency on the U.S. dollar.
Bukele pointed out that the adoption of Bitcoin remains voluntary. “The positive aspect is that it is voluntary; we have never forced anyone to adopt it. We offered it as an option, and those who chose to use it have benefited from the rise in Bitcoin,” he explained. While Bukele had hoped for greater adoption, he emphasized that the freedom to choose was a core value of the initiative.
The Bitcoin Law was introduced during a bullish market phase, and the government initially allocated $75 million to distribute approximately $30 in Bitcoin to individuals who registered for the state-backed Chivo wallet. The country also integrated Bitcoin as a long-term treasury asset and announced plans to develop a national Bitcoin mine powered by geothermal energy from volcanoes.
Bukele noted that those who invested in Bitcoin early have seen substantial gains. “Those who saved in Bitcoin have likely seen decent returns now that the price is near all-time highs,” he said. However, he also acknowledged that those who chose not to use Bitcoin missed out on these gains.
While Bukele does not consider Bitcoin to be definitively the currency of the future, he sees potential in it. He highlighted the increasing involvement of Wall Street firms in the crypto industry and the growing influence of Bitcoin in U.S. elections as indicators of its significance.
Despite facing skepticism from both national and international critics—such as Moody’s downgrading El Salvador’s credit rating and concerns about Bukele’s fiscal policies—Bukele pointed out that the International Monetary Fund has softened its stance on the policy. He believes that the positive outcomes, including enhanced national branding, foreign investments, and increased tourism, outweigh the negatives.
“In the end, being a ‘First Mover’ gives us a small advantage. I feel it could have been much better, but I wouldn’t consider it a resounding success,” Bukele concluded. “Still, I believe that the positive outcomes outweigh the negative, and the issues highlighted are relatively minor.”