“Next week I will send to congress a bill that will make bitcoin a legal tender,” Bukele said, according to the conference’s organizer, Bitcoin Magazine.
Bukele, a 39-year-old, right-wing populist who rose to power in 2019, has a strong majority of 56 out of 84 seats since a landslide victory in legislative elections last March. That means passage of the bill is likely.
Bukele said El Salvador partnered with digital finance company Strike to establish the logistics of the decision.
“Over 70% of the active population of El Salvador doesn’t have a bank account. They’re not in the financial system,” Strike CEO Jack Mallers said. “They asked me to help write a plan and that they viewed bitcoin as a world-class currency and that we needed to put together a bitcoin plan to help these people.”
El Salvador currently uses the United States Dollar as its official currency.
The future of digital currencies
Although central banks around the world have reacted to bitcoin with fascination, they have been hesitant to embrace cryptocurrencies because of their extreme volatility. Bitcoin, for example, crashed by more than half its value earlier this year after rocketing to a record high above $60,000. Other, more thinly traded cryptocurrencies are even more volatile, trading up and down like seesaws — often based on speculation or meme tweets from Tesla CEO Elon Musk.
However, crypto’s rise