The cryptocurrency market exploded when El Salvador legalized Bitcoin. However, the current crypto cold has cast doubt on this conclusion.

Cryptocurrencies are still in their infancy and have enormous growth potential. Nevertheless, specified nations are ahead of the pack in terms of crypto's mainstream acceptance, while the others lag behind. Despite media attention, the government has had difficulty achieving widespread crypto adoption.

Country Drives Cryptocurrency Adoption

El Salvador's prez, Nayib Bukele, stated that Btc will be recognized as legal tender in September 2021. The destination in South America was the first to recognize bitcoin as legal tender.

Bukele’s decision is largely recognized as a country’s first effort to adopt a volatile currency as legal money. The International Monetary Fund and other senior economists slammed the proposal.

Several financial experts questioned the conclusion of the judgment, given Bitcoin’s significant volatility. These opponents argue that because cryptocurrency has no tangible basis, the choice seems hasty and unprepared.

El Salvador’s BTC adoption strategy has been impacted by the cryptocurrency market’s volatility, notably Bitcoin. In November 2021, Bitcoin was selling at $69,000. It fell to $30,000 a little more than six months later, in June 2022. The global crypto market valuation has dropped from an all-time high of $ 3 trillion to $ 1.25 trillion in the previous six months.

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BTC Reception in El Salvador
A recent National Centre of Econometric Analysis (NBER) survey indicates that Bitcoin's popularity in El Salvador must have stalled. After receiving the $30 incentive, more than 60% of respondents abandoned the government's Chivo wallet, per the survey. By both the end of the year, 2,1 billion dollars Latin americans, or 75 percent of people, were using the Chivo wallet.

In addition, the survey revealed that 89% of People in south africa had never received remittances through the app (only 3% used BTC). According the results of the survey, 99 percent of respondents had never paid their bills with Bitcoin.

Setbacks

The impressive acceptance of btc in El Salvador appears to have hit a roadblock recently. Since its November 2021 peak of roughly $69,000, Bitcoin's value has decreased by approximatly 70%. The global decline in Bitcoin prices has had an effect on El Salvador, which is already struggling with a major financial issue. Now, monero acceptance throughout El Salvador lags behind.

The value of the LATAM country's $105 million investment in 2,301 bitcoins has decreased by more than half to approximately $51 million.

While the President is very optimistic (some might say delusional), the reality is very different as El Salvador doesn’t seem to favor BTC adoption.

Is it wise to accept Bitcoin as a national currency when your population is one of the poorest in Latin America, when the adoption of crypto is lagging, and when your government is deep in debt and has been surviving a long time on loans? We’ll let you make up your own mind.

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