Since El Salvador adopted bitcoin as legal tender, crypto analysts have expressed skepticism about its acceptance and influence on the traditional finance sector, citing concerns that the cryptocurrency might wreak havoc on the country’s frail economy.
President Nayib Bukele of El Salvador is a technoid millennial who has long advocated for increasing acceptance of digital currency.
However, it appears as though this decision was primarily a blunder, since the country’s move to adopt cryptocurrency as legal tender is already backfiring.
Majority Of Salvadoran Businesses Don’t Use Bitcoin
According to a new poll conducted by El Salvador’s chamber of commerce, the majority of the country’s businesses do not use Bitcoin – an astonishing finding given Bukele’s efforts to promote Bitcoin usage.
The survey shows that only 14% of respondents have used BTC in transactions since September, when the cryptocurrency became legal tender in El Salvador.
Additionally, the poll reveals that a sizable proportion of respondents have not observed any impact on their sales as a result of adoption.
Bukele made a huge promise to his constituents when he originally introduced the Bitcoin law in June of last year.
BTC total market cap at $793.68 billion on the weekend chart | Source: TradingView.com
Bitcoin Imagined As An Economic Savior
Adopting Bitcoin, he explained, would digitize the economy, reduce reliance on the US dollar, decrease transfer costs — which currently account for about a quarter of the central American country’s gross domestic product (GDP), and stimulate investment.
El Salvador could become the first country to demonstrate cryptocurrency’s transformational capacity on a national scale.
The country’s finance officials endorsed a report in January this year that at least 4 million users — nearly the entire country’s population — had been authenticated as real users of the government’s digital wallet over the previous several weeks.
The Figures Say It All
However, a poll issued this month by the country’s Chamber of Commerce revealed that 85% of enterprises surveyed had never executed a Bitcoin transaction.
While the majority of businesses in the study were small enterprises, accounting for 70% of respondents, 15% were large businesses, and 13% were medium-sized organizations.
What this poll demonstrates is that, despite the government’s numerous efforts to promote the crypto’s acceptance, the level of adoption remains very low.
Despite the low adoption rate, Bukele remains bullish on the coin, with the country now holding approximately 1,800 units.
Featured image from DigFin, chart from TradingView.com