06.12.2021

El Salvador has recognized Bitcoin as a legal tender. Will Russia follow the same path?

A historic event happened yesterday: a law came into force in El Salvador that makes Bitcoin a legal tender in local jurisdictions. Now one of the Latin American countries has officially recognized the cryptocurrency and gave it a status comparable to that of the national currency and the dollar.

However, this day was not without force majeure: for example, the national crypto wallet Chivo at the start faced problems with work due to server errors. Let’s talk about what is happening in more detail.

Note that now you can actually pay with Bitcoin in El Salvador. Fans of cryptocurrencies in the country have already tested the function and shared the results. In particular, you can definitely spend BTC at your local McDonald’s.

After placing an order, visitors receive a QR code that takes them to an invoice page on the Lightning Network. Commissions in this Bitcoin network are equivalent to cents, and transfers are very fast.

QR code for order payment in Salvadoran McDonald’s

And here is an order paid for with cryptocurrency.

mcdonald's bitcoin

A dish paid for with cryptocurrency at Salvador’s McDonald’s

However, at first, residents of the country were faced with the problem of a non-working national cryptocurrency wallet.

A historic moment for Bitcoin

Salvador President Nayyib Bukele assured Chivo that everything is in order and the wallet will continue to operate normally. Here is his line, quoted by Cointelegraph.

For a while, Chivo did not work, as we turned it off while the servers were increasing. The installation problems that some people have had were caused by this. They will be corrected before reconnecting.

Chivo Bitcoin Cryptocurrency Adoption

Chivo koeshelek

Recall that the adoption of Bitcoin in El Salvador became known at the beginning of the summer. Since then, the decision of the local government has managed to receive a large portion of criticism, both from large international organizations and from the population. The main argument against Bitcoin is that the cryptocurrency is too volatile, which can seriously harm the economy.

Nayib Bukele Salvador President

President of El Salvador Nayyib Bukele

According to Bukele himself from Twitter, the country officially owns at least 550 BTC, or almost $ 24.8 million at the current cryptocurrency exchange rate.

Bitcoin cryptocurrency blockchain

Nayib Bukele’s tweet about buying bitcoins

The adoption of Bitcoin in the country was overshadowed by the sudden collapse of the crypto market – yesterday BTC fell in price by more than 13 percent and is now trading in the region of 45 thousand dollars .

Bitcoin chart cryptocurrency trading

Bitcoin crash yesterday

However, in addition to criticism, many experts see yesterday’s event as a huge step towards global recognition of the main cryptocurrency. For example, here is a quote from the head of the CEX.IO exchange, Konstantin Anissimov.

The big advantage of Bitcoin for the economies of countries is that they will not have debts that they owe someone to pay off. This also means that these countries will offer excellent opportunities for the adoption of other cryptocurrencies and for crypto startups.

This means that the expert predicts the activation of entrepreneurs within the country. Earlier, the President of the country also invited various companies to start working in El Salvador.

But in Russia they are not yet ready to make such bold decisions. The press secretary of the presidential administration of the Russian Federation Dmitry Peskov said yesterday that the Kremlin has no reason to consider BTC as an alternative to the national currency. According to him, such a step will only destabilize the economy.

In addition, Peskov called Bitcoin a “quasi-currency”, that is, a fake means of payment that only replaces “real” money. Here is his remark, quoted by RIA.

It is clear that Russia is not ready for such steps.

RF Dmitry Peskov

Press Secretary of the President of the Russian Federation Dmitry Peskov

We believe that the decision to recognize BTC nationally in El Salvador was very bold and risky. Bitcoin is known for its high volatility, and yesterday’s market crash only confirms this. Therefore, the national economy on the “cryptorels” is unlikely to be stable.

At the same time, in the long term, the role of the recognition of Bitcoin as a means of payment on the territory of an entire state is simply incredible. In the future, other countries will most likely join the initiative, which will also officially purchase BTC and other top coins for their own reserves. And this will clearly lead to the massive proliferation of digital assets.

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