Salvadoran economist urges President Nayib Bukele to give Bitcoin to the poor. The move will pay off in the long run, as it will improve the country’s economy by bringing more people into the financial system. The economist suggests that the government should give away a small amount of Bitcoin to every citizen, helping them to become familiar with the cryptocurrency and encouraging its use. This will also help to alleviate poverty in the country, making it a win-win situation for all involved.
El Salvador’s Bitcoin investment should be used to help the poor, says economist
President Nayib Bukele’s love for Bitcoin has been a controversial issue in El Salvador, mainly due to the country’s extreme poverty rates. According to UCA El Salvador University Professor Rafael Lemus, the country’s leader should use his failed cryptocurrency investment to help the poorest households in the country. President Bukele made Bitcoin legal tender in El Salvador in 2021 and has invested heavily in the cryptocurrency, spending over $113 million to date, according to data from the Nayib Tracker website. Despite Bukele’s popularity in El Salvador, his Bitcoin bet has been criticized by the likes of the World Bank and the IMF. Not many Salvadorans use the cryptocurrency for everyday purchases, and many believe that the investment could be better utilized to help the country’s poorest citizens.
Professor Lemus suggests that Bukele should undo his Bitcoin investment and recover what he can to allocate it to the poorest households. This move could prevent the poorest households in the country from moving into extreme poverty due to inflation. El Salvador is known for its endemic gang violence and, until recently, had one of the highest murder rates in the world. However, under Bukele’s watch, the homicide rate has dropped dramatically, providing hope for the country’s future.
Despite the president’s encouragement to use Bitcoin, merchants other than major companies like McDonald’s or Starbucks have shown limited interest in the asset when “Decrypt” visited the country in 2021. El Salvador’s Bitcoin Law requires businesses in the country to accept the cryptocurrency if they have the technological means to do so. Citizens were also encouraged to use it as legal tender. However, the idea has not taken off as quickly as Bukele might have hoped.
Given the country’s economic challenges, it is reasonable that the president should consider using alternative methods to support the most vulnerable members of society. The potential abandoned Bitcoin investment could be a game changer for the poor, allowing them not only to alleviate poverty but also to have improved lives. Through better life conditions, El Salvador could progress and create a brighter future for its citizens.