Could It Be Too Early For El Salvador’s Bitcoin Law? Our TALKING HEADS Respond

It’s time for a new show. In TALKING HEADS, we will ask the experts about the cryptoverse’s overarching themes and latest news. It’s that simple. And, since we’re starting on Bitcoin Day, the first TALKING HEADS has to be about El Salvador adopting Bitcoin as legal tender. However, we’re going to flip the narrative on its head.

Related Reading | Central American Bank For Economic Integration Bullish On Bukele’s Bitcoin Bet

Here at Bitcoinist, we’ve been playing defense. We fought Steve Hanke and The National Review. Made fun of JPMorgan. Called CNBC clueless; because, frankly, they were. Answered Wired’s hit piece, and gave Vice the “most disgusting article award.” We also produced a convenient and straight-to-the-point news roundup (for example: one, two, three.) Plus, we proved to be fair and balanced by raising questions about the central bank and reporting on the CBDC rumors.

And now, it’s time to question the whole thing. We asked today’s TALKING HEADS:

What do you think can go wrong with El Salvador’s Bitcoin adoption? Does the project have an Achilles heel? Can it be too early for the hyperbitcoinization of a whole country?

What do today’s experts think about this fascinating topic? And, who exactly did we get for TALKING HEADS’ inaugural edition? Answers a-head. 

TALKING HEADS: Pavel Shkitin, CEO Of The Nominex Cryptocurrency Exchange

“I believe that the Bitcoinization of El Salvador will make this country a powerful nation economically. External capital can come to El Salvador if the government is able to make good on its promises and does everything competently, in the form of clear legislation, without tightening the screws. 

On the other hand, crime and gangster clans are highly common in El Salvador – this can scare off global companies from establishing their offices there. It is also equally important that global companies, having received regulation in El Salvador, can freely serve clients from other countries. In fact, this is likely to be a problem, since El Salvador in this regard is not, for example, an authority in the European Union.

Therefore, it is likely that the Bitcoinization of El Salvador will matter mainly for the citizens of El Salvador, whose population is 6.5 million people, which is not a lot. In all, I am not very optimistic about the chances of El Salvador to significantly affect global Bitcoinization. But if other countries follow El Salvador, then it can become a snowball, and then after a while, it will be possible to talk about the important pioneering role El Salvador played in global Bitcoinization.”

– Pavel Shkitin

“There are many things that could go wrong when you involve the government in any project. The Achilles heel in El Salvador is the government wallet. Will it be used to monitor and control bitcoin users in El Salvador? It’s hard to say. For now, Salvadorians will have the option to leave the wallet for a non-custodial version. 

It really comes down to the intentions of President Bukele. He has a lot of power in his country. My parents have lived in El Salvador for 7+ years and they have mentioned Bukele has “dictator” like tendencies. This does not mean he will become a dictator, but it’s something to keep an eye on as he reaches the end of his last term.

Ultimately, many Salvadorians are gaining access to financial services for the first time in their lives and although there are potential risks, this will be an incredible net benefit to the country. This move will likely pay off for decades to come.”

– Dennis Porter

BTC price chart on Bitbay | Source: BTC/USD on TradingView.com

TALKING HEADS: Gustavo De La Torre, Business Development Director At n.exchange

“Many eyes are on El Salvador as industry stakeholders are waiting to see if the Bitcoin as a Legal Tender move will lower remittance costs compared to existing options. The country’s bold move to legalize Bitcoin was met with criticisms from internal financial watchdogs, including World Bank and the IMF. While CABEI, the regional development bank has promised El Salvador the necessary technical support needed, the only drawback that may be faced includes restricting legislation on Bitcoin-backed remittance inflows from countries beyond the Central American region. The Bitcoin move by El Salvador is seen as an experimental push which, if successful, can push other neighboring countries to trail the footsteps of the country in powering remittances to the benefit of their citizens.”

– Gustavo De La Torre

Related Reading | Aljazeera Vs. El Salvador’s Bitcoin Law: The Good, The Bad, And The Ugly

TALKING HEADS: Tony Spilotro, Editor At Bitcoinist And NewsBTC 

What do you think can go wrong with El Salvador’s Bitcoin adoption?
“I think several things could go wrong with this plan, but someone has to take the first step or else the needed adoption won’t happen. In terms of one scenario, if Bitcoin crashes 80% or more as it has in the past, how does this impact the nation’s wealth which has already taken a beating? There is a recipe for potential disaster there which could work counter to Bitcoin adoption and support the idea of CBDCs.”

Does the project have an Achilles heel?
“I don’t necessarily think there’s an Achilles heel in anything related to Bitcoin, but I do think the project faces opposition from the IMF and other global entities – which could perhaps be viewed as a weakness to the project.”

Can it be too early for the hyperbitcoinization of a whole country?
“Yes. And in fact, I think it may still be too early. But someone must be an innovator and I completely understand the need for Latin America to take the first steps. There is less downside risk for these nations related to Bitcoin, because the dollar and other fiat currencies haven’t been very kind to them. America on the other hand thrives on the dollar’s reign and has no need for such a system currently (so they think).”

– Tony Spilotro

Let’s close this with a related and relevant poll. How long until Bitcoin becomes the global reserve currency?

With #Bitcoin becoming legal tender in #ElSalvador, how long until it becomes the global reserve currency? @nayibbukele

— Bitcoinist.com (@bitcoinist) September 7, 2021

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