Why El Salvador Made Bitcoin Legal Tender with President Nayib Bukele

 
 
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“This is just exercising our sovereign right to adopt legal tenders, like we adopted the US dollar in the year 2001...the only difference probably is the reasons why we are doing this; in 2001, it was probably done for the benefit of the banks, and this decision is done for the benefit of the people.”
— Nayib Bukele

SHOW DESCRIPTION

Location: El Salvador
Date: Friday 18th June
Project: El Salvador
Role: President

Twenty years ago, El Salvador became a dollarised nation, bringing economic stability to the country and improving the country's potential for investment. However, it did so at the cost of giving up its monetary policy to the US Federal bank.

Two decades later, following the COVID-19, the global economic outlook has changed significantly. As a result, the Fed has taken extreme measures to combat the economic impact of the pandemic and is printing money at previously unseen levels. 

The stimulus packages that help American's do not make their way to dollarised El Salvador, but the people of Salvadorans do suffer the adverse effects of the US debasing the dollar.

Two years ago, Nayib Bukele won a landslide presidential election in El Salvador, becoming the first President since the Salvadoran Civil War who did not represent either of the two major parties.

As the founder of the political party Nuevas Ideas, President Bukele lived up to his reputation when on the 8th of June 2021, El Salvador enacted its Bitcoin Law, making it the first country to adopt bitcoin as a legal tender. The decision has been met with excitement and scepticism. 

Could this bold move be a catalyst for prosperity in El Salvador? And will other nations follow suit, potentially helping billions?

In his first interview since the Bitcoin law was passed, I talked to El Salvador President Nayib Bukele. We discuss the decision to make bitcoin legal tender, education & infrastructure, volcano mining, and why he believes bitcoin is a ‘no-brainer’.

TIMESTAMPS

00:06:23: Introductions
00:07:07: The reason behind the President's decision
00:13:29: Risks of making Bitcoin legal tender
00:15:32: Being a President
00:21:01: Don't trust the man; trust the system
00:23:44: Could the law be halted?
00:27:57: The benefit of the President's youth
00:30:01: The President's legacy
00:33:19: The Presidential term
00:38:30: The President's views on Bitcoin
00:42:35: World Bank announcement
00:43:35: The talent behind the project
00:45:42: El Salvador and the IMF
00:47:35: The 90-day rollout strategy
00:48:25: Articles 7, 8 and 12
00:55:07: El Salvador's currency reserves
00:56:39: Bitcoin education for El Salvador
00:58:13: The government wallet
01:01:52: Altcoins
01:03:57: Permanent residency and tax options
01:07:27: Mining with geothermal energy
01:12:21: Final comments


 

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SHOW NOTES

PodcastPeter McCormack