El Salvador becomes a crypto laboratory with bitcoin gamble

El Salvador becomes a crypto laboratory with bitcoin gamble

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Like millions of Salvadorans, chauffeur Ricardo López has spent the past few weeks trying to get his head around Bitcoin. Once the digital currency becomes legal tender this week, he is not sure he will accept it, but if he does he will convert it immediately into US dollars.

“They say the price varies and that it’s a bit like the stock market,” the 37-year-old said. “Most people are afraid because of the lack of information.”

Twenty years after it adopted the US dollar as its national currency, El Salvador will on Tuesday become the first country in the world to make Bitcoinlegal tender. 

In a plan spearheaded by the Central American nation’s populist president Nayib Bukele, citizens will be able to shop, pay taxes and buy land in the volatile cryptocurrency.

Proponents say it will cut the fees Salvadorans pay to send home remittances — which represent one quarter of the country’s GDP — promote financial inclusion for those without bank accounts and facilitate access to a potentially high-yielding asset.

Critics say the rushed plan could cost poorer Salvadorans when the price falls, raise costs for banks and insurers, provide