El Salvador could become the first country in the world to make Bitcoin legal tender under proposals by its president.
The move will “generate jobs and help provide financial inclusion to thousands outside the formal economy”, President Nayib Bukele said in a recorded message to the Bitcoin 2021 conference in Miami, Florida.
The cryptocurrency could also be “the fastest growing way” to transfer remittances – or money sent home from abroad – if El Salvador‘s congress approves legislation he plans to send its way next week, the 39-year-old leader added on Twitter.
#Bitcoin has a market cap of $680 billion dollars.
If 1% of it is invested in El Salvador, that would increase our GDP by 25%.
On the other side, #Bitcoin will have 10 million potential new users and the fastest growing way to transfer 6 billion dollars a year in remittances.
— Nayib Bukele 🇸🇻 (@nayibbukele) June 6, 2021
The US dollar is the current official currency of the Central American nation. About one quarter of El Salvador’s citizens live in the US.
Mr Bukele, who has maintained approval ratings above 90% since taking office in 2019, tweeted a large chunk of the $6bn El Salvador nationals living abroad currently send home each year is “lost to intermediaries”.
The president, whose New Ideas party has a super-majority in congress, touted adopting Bitcoin as an idea that could help El Salvador progress – despite its recent volatility.
“By using #Bitcoin, the amount received by more than a million low income families will increase in the equivalent of billions of dollars every year,” he said.
The president highlighted the fact that 70% of the country’s population worked in the informal economy and did not have a bank account. He called financial inclusion a “moral imperative” and a way to grow the economy, providing access to credit, savings, investment and secure transactions.
The legislation due to be sent to congress is expected to pass into law, although Mr Bukele has yet to provide more details about how his policy would work.