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BTC Adoption in El Salvador Failed, US Survey Says

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A recent survey conducted by the US National Bureau of Economic Research concluded that the adoption of BTC (BTC) as a legal tender in El Salvador has failed.

That’s because, according to the survey, only 20% of Salvadoran respondents said they continue to use the government-created BTC wallet, Chivo.

As reported by Bloomberg on Tuesday (26), the survey was carried out in partnership with the company Cid Gallup. The purpose of the survey was to understand how is the acceptance of cryptocurrency in the first country to give it legal tender.

As a result, the survey found that many Salvadorans stopped using the Chivo wallet. It is worth noting that the government of Nayib Bukele distributed the equivalent of $30 worth of BTC in September last year to anyone who downloaded the wallet application.

The strategy aimed to encourage the use of digital currency in the country. And it was precisely in that month that most downloads took place.

However, according to the survey, this was not enough to make Salvadorans continue using Chivo.

Use of BTC in El Salvador

Meanwhile, the “few” users of the wallet, according to the survey, use it for remittances, taxes and daily purchases.

“The most important reason not to download the app, conditional on knowledge, is that users prefer to use cash, which was followed by trust issues. Respondents did not trust the system or BTC itself,” the study said.

The researchers also said they found no evidence that the Chivo wallet is being used to pay taxes and remittances on a significant scale as Bukele had claimed it would. In 2022, only 1.6% of remittances were sent through digital wallets in the nation.

Among companies, 20% reported that they are accepting BTC payments. Since most of those that accept are large companies.

Also according to the study, on average, 5% of all sales were in BTC. Even so, most transactions were converted into dollars.

Companies conducted face-to-face interviews with adults in 1,800 households in El Salvador in February 2022. The survey has a margin of error of 2%.

El Salvador vs. IMF and USA

It is worth noting that El Salvador’s initiative to adopt BTC has been closely monitored mainly by the US and the International Monetary Fund.

According reported by CriptoFácil, in February, a group of US senators introduced legislation focused on describing the use of BTC by Salvadorans.

At the time, Bukele said that El Salvador was not a US colony. Therefore, the North American country should not interfere in Salvadoran decisions.

Prior to that, in January, the IMF executive board recommended that El Salvador abandon BTC as legal tender. For board members, cryptocurrency presents financial risks and created liabilities.

Then the Salvadoran government relaunched the Chivo wallet and announced the implementation of 1,500 BTC ATMs.

Information on setting up the paper wallet

All content in this article is for informational purposes only and in no way serves as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.

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