Government expects 2.5 million residents to download bitcoin application in El Salvador

RIO DE JANEIRO, BRAZIL – The Government of El Salvador estimates that some 2.5 million citizens will download the application with the electronic wallet promoted by the Executive for the use of bitcoin as a means of payment, according to the Minister of Finance, Alejandro Zelaya, said Monday.

The official said during a television interview that “a limit of 4 million users has been established”, but that “in the first moments,” it could be around 2.5 million.

Zelaya indicated that “it is not an obligation to download the electronic wallet” and that “the fact that the Government is promoting it does not mean that it is an obligation”.

“It is not an obligation. You can continue paying in cash or with the other methods that are used, but with time they will realize that it is easier to use the Government’s wallet,” he said.

He clarified that the US$30 that the Government will provide to each user who downloads the application called Chivo “are for use through the application, not to take them out in cash.”

President Nayib Bukele explained last week in a national radio and television chain that the Government will create an electronic wallet that will have an account in dollars and bitcoin, which can be downloaded on IOS and Android devices.

When downloading the app, users will have to enter their Documento Único de Identidad (DUI) number and cell phone number to register, he said.

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“By just downloading the app and registering, you will receive 30 dollars equivalent in bitcoin for your consumption (…) when you receive the money, you can choose whether you want bitcoin or not,” the president said.

He pointed out that “those 30 dollars are to promote the use of bitcoin and to encourage people to download the App”, which, according to the president, will be compatible with “all electronic wallets in the world”.

Bukele added that the Bitcoin Law will come into force on September 7 and that “it is a law that opens us to the world, it is a law that puts us in the eyes of the world for something good and innovative”.

According to the Central American Institute for Fiscal Studies, the regulation, which has already been published in the Official Gazette after receiving the signature of President Bukele, only contains 16 articles and is approved in an “accelerated” manner, according to the Central American Institute for Fiscal Studies (Icefi).

The law, approved on June 9 by the Legislative Assembly with a large pro-government majority, has generated mixed opinions, mainly due to the risk that the country becomes a tax haven for money laundering and tax evasion.

The regulation makes El Salvador the first country in the world to give legal tender to cryptocurrency.