El Salvador declared Bitcoin as legal tender in 2021, a move that attracted global attention and became the first country in the world to use Bitcoin as a national currency. However, as of 2024, despite the government's insistence on purchasing one Bitcoin per day, actual popularity and public acceptance have not met expectations.
**Country Impact**: This policy of El Salvador established its image internationally as a pioneer in financial innovation. President Booker's decision was seen as a challenge to the traditional financial system and attracted a lot of international attention and investment. However, the actual economic impact is more complex. The number of Bitcoins held by the government has exceeded 5,800. In theory, if the price of Bitcoin rises sharply, the country will make huge profits. But so far, the economic benefits have not materialized significantly, in part because Bitcoin’s volatility creates fiscal uncertainty.
**Common People's Habits**: For ordinary Salvadorans, Bitcoin has limited acceptance. Most people still rely on the U.S. dollar for daily transactions. Although the government and some merchants accept Bitcoin, daily usage is low, partly due to lack of education and infrastructure. Bitcoin usage is more concentrated in tourist areas and some cities, and ordinary people do not understand and trust it enough.
**Prospect**: El Salvador has the potential to become a global Bitcoin hub. The government's persistence and international attention provide it with a unique opportunity for development. If Bitcoin gains wider acceptance worldwide, El Salvador may lead the way in the fintech sector. However, this requires changes in the global policy environment and an improvement in the stability of Bitcoin itself.
**Challenges**: First, education and infrastructure are the biggest obstacles. The use of Bitcoin requires users to have a certain level of technical knowledge and trust, which is particularly prominent in El Salvador, where education penetration is limited. Second, financial volatility poses a threat to economic stability. The sharp fluctuations in Bitcoin prices may lead to unpredictability in fiscal budgets. In addition, uncertainty in international regulatory and legal frameworks is also a challenge. Finally, technical issues such as network security and transaction speed also limit the widespread use of Bitcoin in daily life. In summary, El Salvador's attempt at Bitcoin is both innovative and experimental. The current popularity shows that there is a gap between policy implementation and actual application. Whether it can become a successful case of Bitcoin in the future depends on many factors, including technological progress, increased international recognition, and continued support from domestic policies and popularization of education.
